IIFL’s Bond Issue of up to Rs. 500-cr opens on 5th Sept.2012-By Sachin Murdeshwar

IIFL’s Bond Issue of upto Rs. 500-cr opens September 5, 2012
Provides options to earn regular monthly income and accumulate to double in 6 years!

Mumbai 4th Sept.2012 (Sachin Murdeshwar):India Infoline Finance Limited (IIFL) is opening on September 5, 2012, a Public Issue of Un-Secured Redeemable Non-Convertible Debentures of face value of Rs 1,000 each (“NCDs”) aggregating up to Rs500 crores including green-shoe option. The Bonds will be in the nature of subordinated debt and will be eligible for Tier-II capital. The issue is on first come first serve basis and therefore depending on response, it can close quicker than official closing date of September 18 ,2012.

 

If you want to gift it to your ageing parents, consider monthly income option of Rs1,062.5/- per month on Rs1 lakh and if you want to gift it to your young children, consider cumulative option where your Rs1 lakh invested now, will fetch Rs2.05 lakh after 6 years. IIFL 12.75%- 6 year bonds have all options to take your interest monthly, yearly or accumulate over 6 years. The yield on redemption works out highest in monthly option at 13.52% p.a.

 

The bonds will be listed on National Stock Exchange of India Limited (“NSE”) and BSE Limited (“BSE”) and minimum application amount is Rs 5,000. The bonds have been rated ‘[ICRA]AA- (stable)’ by ICRA, and ‘CRISIL AA-/Stable' by CRISIL. The above ratings indicate high degree of safety for timely servicing of financial obligations and these instruments carry very low credit risk. The lead managers to the proposed public issue of bonds include Axis Bank and SBI Capital Markets.

 

IIFL is RBI registered NBFC and a subsidiary of India Infoline Limited, a well known broking and wealth management company. IIFL gives only secured loans such as Mortgage loans, Gold loans, medical equipments loans, loans against shares etc. The consolidated loan book was around Rs6750 crores as on March 31, 2012. Non Performing assets as on March 31, 2012 were less than 0.5%, much lesser than the industry average. IIFL has presence all across India with over 1300 branches and more than 6000 employees.

There are three investment options:

 

Option I (Monthly interest payment): The redemption date is 72 months from the deemed date of allotment and the coupon rate is 12.75% p.a. The interest payment frequency is monthly and the face value plus any interest that may have accrued is payable on redemption. The effective yield on this option is 13.52% per annum.

 

Option II (Annual interest payment): The redemption date is 72 months from the deemed date of allotment and the coupon rate is 12.75% p.a. The interest payment frequency is annual and the face value plus any interest that may have accrued is payable on redemption. The effective yield on this option is 12.75% per annum.

 

Option III (Redemption premium): NCDs will be redeemed at Rs 2,054.50 at the end of 72 months from the deemed date of allotment. The effective yield on this option is 12.75% per annum.

The lead managers to the proposed public issue of NCDs are Axis Bank Limited, SBI Capital Markets Limited, Edelweiss Financial Services Limited, Trust Investment Advisors Private Limited and India Infoline Limited (only for marketing of the Issue), while the Co-lead managers to the Issue are RR Investors Capital Services (P) Limited and Karvy Investor Services Limited.  The Prospectus is available on the website of the Company at www.iiflfinance.com; and websites of NSE and BSE at www.nseindia.com; www.bseindia.com respectively and on the respective websites of the Lead Managers at www.axisbank.com, www.sbicaps.com, www.edelweissfin.com, www.trustgroup.co.in, www.iiflcap.com, and Co-Lead Managers at www.rrfinance.com/rrfcl.com and www.karvy.com.