Sammaan Capital NCD Sep-2024 – Issue Details and Review

Sammaan Capital NCD Sep-2024 – Introduction
Sammaan Capital Limited (Formerly Indiabulls Housing Finance Limited) has come up with secured NCD bonds (Tranche I) which have opened for subscription now. Sammaan Capital Limited is a non-deposit-taking housing finance company (HFC) registered with the NHB. The NCD interest rates for Sammaan Capital NCD are up to 10.75%. These NCDs have a tenure of 24 months to 120 months, and interest is paid either monthly, yearly, or upon maturity. Should you invest in Sammaan Capital NCD Sep-2024 issue? What are the risk factors one should consider before investing in such high-risk NCDs? In this article we would do Sammaan Capital NCD Sep-2024 Review.

About Sammaan Capital Limited
Company is formerly known as Indiabulls Housing Finance Limited.

Incorporated in 2005, Indiabulls Housing Finance Limited (IBHFL) is a housing finance company registered with National Housing Bank (NHB).
It provides housing loans, LAP (primarily to micro, small and medium enterprises (MSMEs) and small businesses), developer loans and LRD.
As on March 31, 2024, IBHFL’s consolidated AUM stood at Rs. 65,335 crore comprising HLs (72%), LAP (17%) and CC (11%).
The company has presence across major Indian states (especially Maharashtra, Delhi and Uttar Pradesh) with over 150 branches. The erstwhile promoter – Mr. Sameer Gehlaut, had sold his majority stake in IBHFL in December 2021 and resigned from the board in March 2022.

Sammaan Capital NCD Sep-2024 (Tranche I) – Issue details
Here are the NCD issue details.

Subscription opening Date
06-Sep-14

Subscription closure Date
19-Sep-24

Issuing Security Name
Sammaan Capital Limited

Security Type
Secured, Redeemable, Non-Convertible Debentures (Secured NCDs)

Issue Size (Base)
Rs 125 Crores

Issue Size (Option to retain over subscription)
Rs 125 Crores

Total issue size
Rs 250 Crores

Issue price
Rs 1,000 per bond

Face value
Rs 1,000 per bond

Series
Series I to XII

Minimum Lot size
10 bonds and 1 bond there after

Tenure
24, 36, 60, 84 and 120 Months

Interest Payment frequency
Monthly, Annual and Cumulative

Listing on
Within 6 working days on BSE/NSE

Lead Manager
Nuvama Wealth Management LimitedElara Capital (India) Private LimitedTrust Investment Advisors Private Limited

Debenture Trustee/s
IDBI Trusteeship Services Ltd.

Sammaan Capital NCD Sep-2024 – Interest rates
As per the Sammaan Capital NCD Sep-2024 prospectus filed with BSE, here are the Sammaan Capital interest rates. Investors should note that for specific tenure NCDs, the principal amount is repaid in installments, which is the biggest drawback in these NCDs. Please refer to the redemption schedule indicated below for more details.

Series
I
II
III
IV
V
VI
VII
VIII
IX
X
XI
XII

Frequency of Interest Payment
Annual
Monthly
Cumulative
Annual
Monthly
Cumulative
Annual
Monthly
Annual
Monthly
Annual
Monthly

Tenure (Months)
24
24
24
36
36
36
60
60
84
84
120
120

Coupon (% per Annum)
9.65%
9.25%
NA
9.90%
9.48%
NA
10.15%
9.71%
10.50%
10.03%
10.75%
10.25%

Effective Yield (% per Annum)
9.65%
9.65%
9.65%
9.90%
9.90%
9.90%
10.15%
10.15%
10.50%
10.48%
10.74%
10.75%

Amount on Maturity (In Rs.)
1,000.00
1,000.00
1,202.32
1,000.00
1,000.00
1,327.38
1,000.00
1,000.00
1,000.00
1,000.00
1,000.00
1,000.00

Redemption Schedule

Sammaan Capital NCD Sep-2024 – Credit Ratings
These NCDs have been rated CRISIL AA / Stable by CRISIL Ratings and ICRA AA Stable by ICRA. Instruments with this rating are considered to have the highest degree of safety in terms of timely servicing of financial obligations, carrying very low credit risk.
How is the company doing in terms of revenues and profits?
Here are the details of the consolidated financials of the company.

Period Ended
31-Mar-21
31-Mar-22
31-Mar-23
31-Mar-24

Assets
93,239.0
81,973.3
74,945.2
73,066.0

Revenue
10,030.1
8,993.9
8,725.8
8,624.0

Profit After Tax
1,201.6
1,177.7
1,127.7
1,214.0

Reasons to Invest in Sammaan Capital NCD Sep-2024

Sammaan Capital bonds offer attractive interest rates, allowing investors to earn up to 10.75% per annum.
The company issues secured NCDs, which are safer compared to unsecured NCDs. In the event of the company winding up or shutting down for any reason, secured NCD investors would receive preference in the repayment of capital along with interest, as these NCDs are backed by the company’s assets. Therefore, investing in such secured NCD options is considered safe.
The company holds a good credit rating of AA/Stable from both CRISIL and ICRA Ratings.
It provides 12 flexible investment options, allowing investors to choose the one that best suits their preferences.

Risk Factors in Sammaan Capital NCD Sep-2024

The redemption of NCD amounts is done in splits for Series VI and above, meaning investors would not receive their principal amount in a lump sum upon maturity.
Company financial performance can impact due to volatility in interest rates for its lending and investment operations as well as the rates at which company borrows from banks/financial institution
An increase in Non-Performing Assets (NPAs) can negatively impact the business.
Please refer to the NCD prospectus for a comprehensive list of risk factors.

Sammaan Capital NCD Sep-2024 – Should you invest or avoid?
Despite increase in FD interest rates by banks and NBFCs, Sammaan Capital NCDs continue to offer high-interest rates and yield. These NCDs are rated as AA Stable by ICRA and CRISIL which are considered to have good ratings.
However, one should note that such credit ratings are subject to change at any time. Investors should not forget where NBFCs earlier delayed interest payments and the repayment of investment amounts to investors. Additionally, some NCD series of this NCD issue offer the repayment of capital in installments.
Investors can invest in such NCDs if they are willing to consider all these risk factors.

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)