India Infoline Finance NCD: A Secure Option?
9/6/2012 9:00 PM Thursday
India Infoline Finance (IIFL), a 98.87 per cent subsidiary of India Infoline (a leading player in the Indian financial services segment), is tapping the market to raise approximately Rs 500 crore by issuing nonconvertible debentures (NCD) in the nature of subordinated debt.
The company plans to issue NCDs worth Rs 250 crore with an option to retain an over-subscription of Rs 250 crore. The funds raised through the issue will be used to finance activities such as investment and lending, to repay its existing loans and for working capital requirements.
IIFL is a systemically important non-deposit taking non-banking finance company (NBFC) and is registered with the Reserve Bank of India (RBI). Broadly, the business of IIFL includes mortgage loans, capital market finance, gold loans and healthcare finance. As of March 31, 2012, around 85 per cent of the loan book was accounted for by mortgage and gold loans, capital market finance accounted for 12 per cent and the remaining was in healthcare finance.
Over the past two years, the company’s financials have seen a robust growth. In FY2012, its revenues increased by 84 per cent to Rs 953 crore on a consolidated basis, while the net profit grew by 14 per cent to Rs 105 crore on a YoY basis. The loan book of the company stood at Rs 6746 crore as against Rs 3289 crore in FY2011. The net interest margin (NIM) also showed an improvement of 28 basis points to 7.45 per cent. Meanwhile, the asset quality deteriorated slightly, as the net NPAs increased by four basis points to 0.40 per cent as on March 31, 2012.
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