On Thursday, Piramal Enterprises' first NCD issue launches

19 Oct 2023 , 10:20 AM

In order to finance its expansion, Piramal Enterprises Limited announced on Wednesday that it intended to raise Rs 1,000 crore through the first-ever issuing of non-convertible debentures (NCDs). Within the Rs 3,000 crore shelf limit, the tranche I consists of a basic issue size of Rs 200 crore and a greenshoe option of up to Rs 800 crore, for a total up to Rs 1,000 crore.

Subscriptions for the issue begin on October 19 and end on November 2, 2023, with the potential to close early in accordance with Securities and Exchange Board of India regulations.

Jairam Sridharan, MD of Piramal Capital & Housing Finance Ltd., states that high net worth individuals and regular investors will receive 60% of the offer.

It is suggested that the 1,000 face value secured, rated, listed, redeemable, and non-convertible debentures be listed on both the BSE and NSE, with the BSE serving as the designated stock market for the issue.

The application must be at least Rs 10,000 and can be submitted in multiples of Rs 1,000 after that.

The issue offers annual coupon payments for series I, II, III, and IV, with maturity/tenure options of two, three, five, and ten years.

The effective yield for holders of NCDs in different categories varies from 9% to 9.34% annually.

Up to 25% of the net proceeds of the tranche I issue will be used for general corporate purposes, such as branch expansion, and at least 75% will be used for financing, onward lending, and principal and interest repayment of the company’s current borrowings.

Being a non-deposit taking NBFC, Piramal Enterprises Ltd primarily operates solo and through its wholly-owned subsidiary Piramal Capital & Housing Finance Ltd (PCHFL) to provide wholesale and retail financing.

A network of around 424 conventional branches, including 136 microfinance branches spread throughout 25 states and Union Territories, supports the company’s consolidated activities.

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