U GRO Capital, a non banking financial company focussed on small and medium enterprises, on Tuesday announced opening of public issue of bonds later this week to raise up to Rs 100 crore.
The public issue of bonds scheduled to open on April 7, 2022 has a base issue size of Rs 50 crore, with an option to retain over-subscription up to Rs 50 crore.
The issue will close on May 6, 2022 and is focussed to attract retail and HNIs (high networth individuals) customers.
The public issue of rated, secured, senior, listed, transferable, redeemable, non-convertible debentures is of face value of Rs 1,000 each for an amount of Rs 50 crore (base issue) with an option to retain over-subscription up to Rs 50 crore, aggregating to Rs 100 crore, U GRO Capital said.
At least 75 per cent of the net proceeds from the issue is proposed to be utilised towards on-lending, financing and for repayment of interest and principal of existing borrowings of the company, it said during a virtual press conference.
Rest 25 per cent of the funds will be used for general corporate purposes.
The NBFC has been in existence since 1993. The lending market in India is moving away from conventional methods to technology and data analysis tools. Technology enables (lesser) time to reach to a customer and onboard a customer. Second, at the heart of the technology is how do you underwrite and give credit to a customer.
"U GRO over a period of last four years has built proprietary data analytics platform which is called GRO Score 2.0…this is a industry first approach to triangulate three core pillars of data which we believe will transform the MSME financing in India,” Shachindra Nath, Executive Chairman & Managing Director, U GRO Capital told reporters.
He said the company uses three pillars for data analytics which are — GST, banking and credit bureau scores.
"The triangulation of this data allows us to build a predictable model which not only defines the behaviour of the customers, but also defines what eligibility a customer has. It allows us to do a forward looking view for financing,” he added.
Nath said GRO Score 1.0 was repayment behaviour-based scorecard customised for U GRO’s sectors and it has now evolved to GRO Score 2.0 which is a repayment and banking behaviour-based scorecard giving the company a much deeper insight on the MSME.
The non-deposit taking NBFC had total revenues of Rs 153 crore in FY21.
The net profit of the company was Rs 28.73 crore.
Talking about the growth strategies, the company said it will diversify loan book mix and product suite with an exclusive focus on MSME (micro, small and medium enterprises) lending.
It will leverage on technology and digital platforms to improve customer reach and operating efficiency and will continue to maintain prudent risk management policies for its assets under management (AUM).
The company’s AUM stood at Rs 2,588.90 crore as of December 31, 2021 and gross NPAs (non-performing assets) were 2.38 per cent of gross advances.
The bonds will offer coupon rate of 10.37-10.90 per cent for three different series, payable quarterly and monthly.
The tenure of the bonds in three series is fixed at 18 months, 27 months and 36 months.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
