Moneycontrol.com
Gold loan provider, Muthoot Finance on Tuesday announced the launch of its maiden non-convertible debenture (NCD) issue to raise Rs 1,000 crore. It will open for subscription on August 23. The core size of the issue is Rs 500 crore with an option to retain oversubscription of additional Rs 500 crore.
"The purpose of the public issue is to expand our loan book," said George Alexander Muthoot, managing director, Muthoot Finance.
"We expect to grow our loan book at 60% this year. However, small part of the proceeds will also be used to repay our debts. We now want to diversify our borrowing sources instead of depending majorly on one source," he added.
So far, the non-banking finance company or NBFC meets 50% of its fund requirements through bank loans. The rest is through short-term commercial papers, private placement of NCDs and subordinated debts (25%).
The issue has three options for subscription. With maturity of two years, it offers an interest rate of 11.75-12% depending on investors
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