By Dominick Rodrigues
Mumbai : IIFL Home Finance Ltd (IIFL HFL), a retail-focused and technology-driven Housing Finance Company, has announced public issue of Unsecured Subordinated Redeemable non-convertible debentures (“Unsecured NCDs”) opening on July 6 and closing on July 28, with base issue size Rs 100 crores and +green shoe+ up to Rs. 900 crore — aggregating up to Rs 1,000 crores
The NCD issue, which is proposed to be listed on BSE and NSE, offers various options for subscription with coupon rates ranging from 9.60% to 10.00% per annum.
The Unsecured NCDs bear a fixed rate of interest under three different series and have been rated “CRISIL AA/Stable” and “BWR AA+/ Negative (Assigned)” indicating that instruments with this rating are considered to have high degree of safety regarding timely servicing of financial obligations and carry very low credit risk.
Describing the NCDs as a +win-win+ situation with no TDS deductions for investors amidst a “booming” stock market, Nirmal Jain, Group Chairman, IIFL Group, said that the net proceeds of the Issue will be utilized for for the purpose of onward lending, financing, and for repayment /prepayment of interest and principal of existing borrowings of the Company, besides balance being used for General Corporate Purposes.
Monu Ratra, ED and CEO, IIFL Home Finance Limited, highlighted the Group as pioneers in facilitating large-scale adoption of “green buildings” in the residential sector in India, while its business strategy is “Housing for All,” with focus on low and middle-income-group in suburbs of Tier I, II and III cities.
He said that the key highlights of the company included: FY21 witnessing 100% paperless loans process, PAT at Rs 4011 million; AUM Rs 206, 937 million; 125,000 active loans; 125 branches 95% Priority Sector Assets; besides catering to the end-user market.
Ratra said that despite the pandemic, the company witnessed AUM growth of 12% after Q2 last year, besides providing ‘affordable home loans’ – without physical documentation – through the digital platform. “In 40 minutes, a customer knows whether he is getting a loan or not,” he said.
Describing the ‘Co-lending’ opportunity as a “humongous” and upcoming business, he said the banking sector had – since 2016 – faced lots of challenges including demonetization, liquidity crunch, pandemic etc.
“Our healthy growth is showcasing the business model we are operating in and our offerings match the behavioural tenor of investors,’ Ratra said while highlighting the housing market as still being “very narrow and unpenetrated” alongside influx of migration in urban areas .
Replying to questions, he said “Our last five years performance witnessed our resilience amidst changes in the ecosystem and the Tier II and III cities responded to business very strongly in the wake of COVID-19 with the result that the company is now going deeper.”
The Lead Managers to the issue are Edelweiss Financial Services Limited, IIFL Securities Limited*, ICICI Securities Limited, Trust Investment Advisors Private Limited and Equirus Capital Private Limited.
