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Sakthi Finance has launched a public issue of rated, secured, redeemable, non-convertible debentures of face value of Rs 1,000 each. The issue, which will open on 8 February 2024, has base size of Rs 100 crore and an option to retain over-subscription for an amount not exceeding Rs 100 crore, making the overall issue size of Rs 200 crore. The issue will close on 21 February 2024.
NCDs are debt instruments which are placed with the issuing company for a specific period of time at a fixed rate of interest.
The NCDs are proposed to be listed on BSE. The bonds would be issued at face value of Rs 1,000 and the minimum application size is Rs 10,000 across all categories.
There are seven series of NCDs having tenure of 24, 36, 60 and 85 months with monthly and cumulative interest option. Coupon for NCDs ranges from 9% to 10.25% per annum while effective yield ranges from 9% to 14.30%.
The NCDs offered under the issue have been rated "[ICRA] BBB (Stable)" by ICRA. The rating of the NCDs by ICRA indicates moderate degree of safety regarding timely servicing of financial obligations and carry moderate credit risk.
The company proposes to utilize at least 75% of the total estimated net proceed for the purpose of onward lending, financing, and for repayment of interest and principal of existing borrowings of the company; and upto 25% of the total estimated net proceed towards general corporate purposes.
Sakthi Finance is a part of "Sakthi Group" of companies based in Coimbatore, South India. It is an investment and credit company with primary focus on financing pre-owned commercial vehicles. The company also provides finance for purchasing infrastructure construction equipment, multi-utility vehicles, cars, jeeps and other machinery. As on 30 September 2023, it had an Asset Under Management (“AUM”) (i.e. Stock on Hire) of Rs 1196.37 crore.
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