Aditya Birla Finance Limited (ABFL), a subsidiary of Aditya Birla Capital, has announced its first public issue of non‐convertible debentures (NCDs) for an amount up to ₹1,000 crore with an option to retain over-subscription up to ₹1,000 crore. The company will issue 2 crore secured, rated, listed, redeemable NCDs of face value of ₹1,000 each, aggregating up to ₹2,000 crore, as per the prospectus filed by ABFL with the RoC and the stock exchanges.
The issue will open on September 27, 2023, and close on October 12, 2023, with an option of early closure.
The NCDs will come with tenor options of 3 years, 5 years, or 10 years offered with ‘monthly’, ‘annual’ or ‘cumulative’ interest payment frequency. The coupon rates would range from 8% per annum to 8.10% p.a. for annual options with effective yields ranging from 7.99% p.a. to 8.09% p.a. across various series, as per the prospectus filed with exchanges.
The company proposes to utilise at least 75% of the net proceeds of the issue towards onward lending, financing and repayment of interest and principal of existing borrowings of the company. Adding to it, up to 25% of the fund will be used for general corporate purposes.
The NCDs have been rated ‘IND AAA’ with ‘stable’ outlook and ‘[ICRA] AAA (Stable)’ by India Ratings & Research Private Limited and by ICRA Limited, respectively. “The ratings are valid and will continue to be valid for the life of the instrument unless withdrawn or reviewed. Instruments with this rating are considered to have the highest degree of safety regarding timely servicing of financial obligations and carry the lowest credit risk,” it notes.
The minimum application size of ₹10,000 (10 NCDs) across all series collectively and in multiples of ₹ 1,000 thereafter. The allotment will be on a “first-come-first-serve basis”.
“Allotment of NCDs shall be made, in consultation with the Designated Stock Exchange, on a date priority basis, i.e., a first-come, first-serve basis, based on the date of upload of each application into the Electronic Book with Stock Exchanges, in each Portion subject to the Allocation Ratio specified in the prospectus. However, from the date of oversubscription and thereafter, the allotment will be on proportionate basis as detailed in the prospectus,” says the company.
Trust Investment Advisors Private Limited, A.K. Capital Services Limited, JM Financial Limited, and Nuvama Wealth Management Limited (formerly known as Edelweiss Securities Limited) are the lead managers to the issue.
Aditya Birla Finance, a part of Aditya Birla Group, is registered with the RBI as a non-deposit-taking systemically important non-banking financial company. ABFL has been categorised as an ‘Upper Layer’ NBFC under the scale-based regulatory framework for NBFCs introduced by the RBI, with effect from September 30, 2022. It offers end-to-end lending, financing and wealth services to retail, HNI, ultra HNI, micro, small and medium enterprises, small and medium enterprises and corporate customers.
As of June 30, 2023, ABFL had total loans outstanding of ₹85,778.5 crore and a total asset under management of ₹85,891.2 crore. ABFL’s long-term credit rating of AAA (Stable) was reaffirmed by ICRA in February 2023. ABFL also has a long-term credit rating of AAA (Stable) by India Ratings, perpetual debt credit rating of AA+ (Stable) by ICRA and AA+ (Stable) by India Ratings (Stable), short-term credit rating of A1+ by ICRA and commercial paper credit rating of A1+ India Ratings.
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