Muthoot Fincorp Limited NCD: Everything you need to know

3 Jan 2024 , 02:52 PM

Established in 1997, Muthoot Fincorp Limited functions as a non-deposit-taking Non-Banking Financial Company (NBFC). The company specializes in offering secured personal and business loans, utilizing gold ornaments and jewelry as collateral. The gold loan product caters to the short-term liquidity needs of individuals, serving both personal and business purposes.

As of September 30, 2023, Muthoot Fincorp Limited’s gold loan portfolio encompassed approximately 31.68 lakhs of loan accounts.

The company has established a robust presence with 3,619 branches spread across 24 states, including the Union Territory of Andaman and Nicobar Islands and the National Capital Territory of Delhi. In its operations, Muthoot Fincorp Limited employs a workforce of 20,507 people, including 91 contracted experts, as of September 30, 2023.

The company is launching debt offer, and the subscription period for this offer will be from January 12 to January 25, 2023. Click here to apply in the Muthoot Fincorp Limited NCD. 

The company is raising Rs 75 crore from the issue at a price of Rs 1000 each. Investors need to apply for a minimum of 10 NCDs in a lot. The company has received rating of CRISIL AA-/Stable by CRISIL Ratings Limited.

The company will use the net proceeds from the issue for the purpose of working capital requirements and other general corporate purposes.

Muthoot Fincorp Limited has allotted 5% to institutional investors, 35% to non-institutional investors and 60% to retail investors. 

These NCDs have tenures of 24, 36, 60 and 96 Months. It offers coupon rates from 8.90% to 9.75% based on the selection of investors. The frequency of interest payments will be monthly, annually or cumulative basis. Allotment of these NCDs will be in dematerialized mode only. Application is to be made through ASBA mode only.

Check the coupon rates of NCDs of Muthoot Fincorp Limited:

	Series 1	Series 2	Series 3	Series 4	Series 5	Series 6	Series 7	Series 8	Series 9	Series 10
Frequency of Interest Payment	Monthly	Monthly	Monthly	Annual	Annual	Annual	Cumulative	Cumulative	Cumulative	Cumulative
Nature	Secured	Secured	Secured	Secured	Secured	Secured	Secured	Secured	Secured	Secured
Tenor	24 Months	36 Months	60 Months	24 Months	36 Months	60 Months	24 Months	36 Months	60 Months	96 Months
Coupon (% per Annum)	8.90%	9.15%	9.35%	9.25%	9.50%	9.75%	NA	NA	NA	NA
Effective Yield (% per Annum)	9.26%	9.53%	9.75%	9.25%	9.50%	9.75%	9.25%	9.50%	9.75%	9.05%
Amount on Maturity (In Rs.)	Rs 1,000.00	Rs 1,000.00	Rs 1,000.00	Rs 1,000.00	Rs 1,000.00	Rs 1,000.00	Rs 1,194.00	Rs 1,313.00	Rs 1,592.00	Rs 2,001.00

RHP:

https://www.sebi.gov.in/sebi_data/attachdocs/jan-2024/1704171979491.pdf

Tax implications:

• Interest on debentures received by resident debenture holders would be subject to tax at the normal rates of tax in accordance with and subject to the provisions of the I.T. Act.
• As per section 2(29AA) read with section 2(42A) of the I.T. Act, a listed debenture is treated as a longterm capital asset if the same is held for more than 12 months immediately preceding the date of its transfer.
• As per section 2(42A) of the I.T. Act, a listed debenture is treated as a short-term capital asset if the same is held for not more than 12 months immediately preceding the date of its transfer.
• In case debentures are held as stock in trade, the income on transfer of debentures would be taxed as business income or loss in accordance with and subject to the provisions of the I.T. Act.
• Income tax is deductible at source on interest on debentures, payable to resident debenture holders at the time of credit/ payment as per the provisions of section 193 of the I.T. Act.

Muthoot Fincorp Limited NCD is managed by SMC Capitals Limited. Integrated Registry Management Services Private Limited is the registrar of NCD and Vardhman Trusteeship Private Limited is debenture trustee to the same.