10.5% Muthoottu Mini Financiers NCD Oct-24 Public Issue Details
Muthoottu Mini Financiers is coming up with secured NCD bonds now. These NCD bonds would open for subscription on 30 October and closes on 4 November, 2024. Muthoottu Mini Financiers is a non-deposit taking, NBFC-ML in India which is focused on providing loans against pledge of household gold jewelry. The interest rates are up to 10% and yield is up to 10.5%. These NCDs are offered for 7 series and between 450 days to 66 months tenure. These interests are paid either monthly or on maturity. Should you invest in Muthoottu Mini Financiers NCD Oct-24? What are the risk factors in these NCD? In this article we would do Muthoottu Mini Financiers Ltd NCD Review.
About Muthoottu Mini Financiers Limited
They are a non-deposit taking NBFC-ML in the gold loan sector lending money against the pledge of household gold jewellery in the state of Kerala, Tamil Nadu, Karnataka, Andhra Pradesh, Telangana, Haryana, Maharashtra, Gujarat, Delhi, Uttar Pradesh and Goa and the union territory of Puducherry.
They are also have microfinance loan segment wherein they provide unsecured loans to joint liability group of women customers (minimum of 5 persons) who require funds to carry out their business activities through few of their branches in the state of Kerala.
As of 31 March, 2024, they have a network of 902 branches spread in the states of Kerala, Tamil Nadu, Karnataka, Andhra Pradesh, Telangana, Haryana, Maharashtra, Gujarat, Delhi, Uttar Pradesh and Goa and the union territory of Puducherry and they employ 4,563 persons in its business operations.
Muthoottu Mini Financiers NCD October-2024 Issue Details
Opening Date
30-Oct-24
Closure date
13-Nov-24
Issuing Security Name
Muthoottu Mini Financiers Limited
Security Type
Secured, Redeemable, Non-Convertible Debentures (Secured NCDs)
Issue Size (Base)
Rs 100 Crores
Oversubscription
Rs 50 Crores
Total Issue Size
Rs 150 Crores
Issue price
Rs 1,000 per bond
Face value
Rs 1,000 per bond
Minimum Lot size
10 bonds and 1 bond there after
Series
I to VII
Interest Payment frequency
Monthly and Cumulative
Listing on
Within 6 working days on BSE
Lead Manager
Vivro Financial Services Private Limited
Debenture Trustee/s
Mitcon Credentia Trusteeship Services Limited
Interest Rates
Series
I
II
III
IV
V
VI
VII
Frequency of Interest Payment
Monthly
Monthly
Cumulative
Monthly
Cumulative
Monthly
Cumulative
Tenor (in months)
450 Days
26
26
36
36
48
66
Coupon (% per Annum)
8.50%
9.00%
NA
9.50%
NA
10.00%
NA
Effective Yield (% per Annum)
8.84%
9.38%
9.40%
9.92%
9.75%
10.47%
10.50%
Amount on Maturity (In Rs.)
1,000.00
1,000.00
1,215.00
1,000.00
1,322.00
1,000.00
1,732.00
Credit Rating
These NCDs have been rated as CARE A- Stable by CARE which indicate that instruments with this rating are considered to have adequate degree of safety regarding timely servicing of financial obligations and carry low credit risk.
Company Financials
Company revenues grew at 23.4% and profits grew at 15.7% in FY24 compared to previous year. Here are the last 3 years asset details, revenues and margins.
Company Promoters
Nizzy Mathew and Mathew Muthoottu are the promoters of the company.
Why to invest in Muthoottu Mini Financiers NCD’s?
Muthoottu Mini NCD interest rates are attractive where investors can get interest up to 10% per annum and yield up to 10.5%.
Muthoottu Mini Financiers generates consistent revenue and margin growth. Investors should always invest in companies that are growing.
It issues secured NCDs. These NCDs are safe compared to unsecured NCDs. In case company gets into financial crisis and wind-up/shut down, secured NCD investors would get preference in repayment of capital along with interest as those backed up by assets of the company. Hence it is safe to invest in such secured NCD options.
Why not to invest in Muthoottu Mini Financiers NCD’s?
Muthootu Mini Financiers credit rating was upgraded from CARE BBB+: Stable to CARE A-: Stable in July-2022. There is no guarantee that such ratings would continue or upgrade in future.
Company is subject to an inspection by the RBI and any adverse action taken could affect the business.
They are subject to certain legal proceedings and any adverse decision in such proceedings may have a material adverse effect on its business.
They do not own the trademark that have been authorised to use it by one of its Group Companies. Termination or withdrawal on unfavourable terms of this authorisation to use or any negative impact on the ‘Muthoottu Mini’ brand may adversely affect its business and reputation.
Its business is capital intensive and any disruption or restrictions in raising financial resources would have a material adverse effect on the liquidity and financial condition.
Its financial performance is primarily dependent on interest rate risk. If they are unable to manage interest rate risk in the future it could have an adverse effect on its net interest margin, thereby affecting business and financial condition.
Company has high debt equity ratio and any further increase in borrowings may have a material adverse effect on its business and financial condition.
Refer Muthoottu Mini Financiers NCD Oct-24 prospectus for complete risk factors.
How to subscribe to these NCDs?
This issue is available in only in demat form. You can apply online or through any of the broker website where you are maintaining a demat account. For more information on this you can refer prospectus.
Should you invest in Muthoottu Mini Financiers NCD October-2024?
Muthoottu Mini Financiers NCD of Oct-24 issue offers high interest rates. These NCDs are rated as A-: Stable by CARE Ratings which are good. However such ratings were upgraded couple of years back. Such credit ratings may change in future. High risk investors can invest in these secured NCDs. Moderate to low risk investors should avoid such NCDs.
Suresh KP is the Founder of Myinvestmentideas. He is NISM Certified – Investment Adviser and NISM Certified – Research Analyst. He has been analyzing financial markets in the last 20 years.He can be reached at suresh@myinvestmentideas.com Latest posts by Suresh KP (see all)
