Cholamandalam Finance to raise up to Rs 5,000 cr. via NCDs, launches Maiden Tranche I Issue of up to Rs 1,000 cr., Tranche I Issue Opens April 25, 2023
by Priya Jadhav
Coupon Rate
Upto 8.40% p.a.Effective Yield
Up to 8.40% p.a.
·
Maiden
public issue of secured, rated, listed, redeemable non-convertible debentures
(“NCDs”) of face value and Issue price of ₹ 1,000 each
·
The
Tranche I Issue includes a base Issue size of ₹ 500 crores with an option to
retain oversubscription up to ₹ 500 crores aggregating up to ₹ 1,000 crores;
within a shelf limit of ₹ 5,000 crore
·
NCDs
proposed to be issued pursuant to the Tranche I Issue are rated as “IND
AA+/Stable” by India Ratings & Research Private Limited and “[ICRA]AA+
(Stable)” by ICRA Limited
·
Tenor
options: 22 months, 37 months & 60 months with annual and cumulative coupon
payment options
·
Coupon
rate up to 8.40% p.a.# and Effective Yield up to 8.40% p.a.
·
The
Tranche I Issue opens on Tuesday, April 25, 2023 and closes on Tuesday, May 9,
2023
·
Allotment
on first-come-first-serve basis.
·
The
NCDs are proposed to be listed on BSE Limited (“BSE”) and National Stock
Exchange of India Limited (“NSE”). NSE Limited is the designated stock
exchange for the Tranche I Issue.
This Tranche I Issue shall remain open for subscription on Working Days from 10 a.m. to 5 p.m. (Indian Standard Time) during the period indicated in the Tranche I Prospectus, except that the Tranche I Issue may close on such earlier date or extended date as may be decided by the Board of Directors of our Company or Debenture Committee subject to compliance with Regulation 33A of the SEBI NCS Regulations. In the event of an early closure or extension of the Tranche I Issue, our Company shall ensure that notice of the same is provided to the prospective investors through an advertisement in all the newspapers in which pre-issue advertisement for opening of the Tranche I Issue have been given on or before such earlier or initial date of Tranche I Issue closure. Application Forms for the Tranche I Issue will be accepted only from 10:00 a.m. to 5:00 p.m. or such extended time as may be permitted by the Stock Exchanges, on Working Days during the Tranche I Issue Period. On the Tranche I Issue Closing Date, the Application Forms will be accepted only between 10 a.m. and 3 p.m. (Indian Standard Time) and uploaded until 5 p.m. or such extended time as may be permitted by the Stock Exchanges. Further, pending mandate requests for bids placed on the last day of bidding will be validated by 5 p.m. (Indian Standard Time) on one Working Day after the Tranche I Issue Closing Date. For further details please refer to the chapter titled “Issue Related Information” on page 36 of the Tranche I Prospectus.
Mumbai, April 20, 2023: Cholamandalam Investment and Finance Company Limited (CIFCL), a leading financial services provider in India, has announced its maiden public issue of secured, rated, listed redeemable non-convertible debentures of the face value of Rs. 1,000 each (“NCDs”) with a base Issue size of Rs. 500 crores with an option to retain any oversubscription up to Rs 500 crores, aggregating up to Rs. 1,000 crores, which is within the shelf limit of Rs 5000 crore (“Tranche I Issue”). The Tranche I Issue opens on Tuesday, April 25, 2023 and closes on Tuesday, May 9, 2023 with an option of early closure in compliance with SEBI NCS Regulations.
Out of the Net proceeds of the Tranche I Issue, after meeting the expenditures of and related to the Tranche I Issue, at least 75% shall be utilised for the purpose of onward lending, financing, and for repayment of interest and principal of existing borrowings of the Company and up to 25% for general corporate purposes.
|
Series |
I |
II |
III* |
IV |
V |
VI |
||||||
|
Frequency
of Interest Payment |
Annual |
Cumulative |
Annual |
Cumulative |
Annual |
Cumulative |
||||||
|
Minimum
Application |
₹ 10,000 (10 NCDs) across all Series |
|||||||||||
|
In Multiples
of thereafter (₹) |
₹ 1,000 (1 NCD) |
|||||||||||
|
Face
Value/ Issue Price of NCDs (₹/ NCD) |
₹ 1,000 |
|||||||||||
|
Tenor |
22 months |
22 months |
37 months |
37 months |
60 months |
60 months |
||||||
|
Coupon (%
per annum) for NCD Holders in all Categories of Investors |
8.25% |
NA |
8.30% |
NA |
8.40% |
NA |
||||||
|
Effective
Yield (% per annum) for NCD Holders in all Categories of Investors |
8.26% |
8.25% |
8.30% |
8.30% |
8.39% |
8.40% |
||||||
|
Mode of
Interest Payment |
Through various modes available |
|||||||||||
|
Series |
I |
II |
III* |
IV |
V |
VI |
||||||
|
Redemption
Amount (₹ / NCD) on Maturity for NCD Holders in all Categories of Investors |
₹ 1,000 |
₹ 1,156.64 |
₹ 1,000 |
₹ 1,279.15 |
₹ 1,000 |
₹ 1,497.40 |
||||||
|
Maturity
/ Redemption Date (from the Deemed Date of Allotment) |
22 Months |
22 Months |
37 Months |
37 Months |
60 Months |
60 Months |
||||||
|
Put and
Call Option |
Not Applicable |
|||||||||||
Company shall allocate
and allot Series III NCDs wherein the
Applicants have not indicated the choice of the relevant NCD Series.
A.K.Capital Services Limited is the Sole Lead Manager to the Issue. IDBI Trusteeship Services Limited is the Debenture Trustee to the Issue and KFin Technologies Limited is the Registrar to the Tranche I Issue.
Please note that the Basis of Allotment under the Issue will be on the basis of date of upload of each application into the electronic book of the Stock Exchanges in accordance with the SEBI Operational Circular. However, from the date of oversubscription and thereafter, the allotments will be made to the applicants on proportionate basis. For further details refer section titled “Issue Procedure” on page 55 of the Tranche I Prospectus dated April 19, 2023.
About Chola : Cholamandalam Investment and Finance Company Limited (Chola), incorporated in 1978 as the financial services arm of the Murugappa group. Chola commenced business as an equipment financing company and has since expanded its operations to offer vehicle finance, loan against property, home loans, loans to small and medium-sized enterprise, consumer and small enterprise loans and secured business and personal loans. As of December 31, 2022, it had 1,166 branches across 29 States and Union Territories in India with assets under management above INR 1 Lakh Crores as of FY 2023. The subsidiaries of Chola are Cholamandalam Securities Limited, Cholamandalam Home Finance Limited and Payswiff Technologies Private Limited. As of December 31, 2022, we had 22.70 lakhs active customers across India.
For more details, please visit www.cholamandalam.com
About Murugappa Group : Murugappa group which has more than 122 years of existence. being a part of the Murugappa group, Chola has able to derive significant synergies by leveraging their brand and existing customer base.
Disclaimer: CHOLAMANDALAM INVESTMENT AND FINANCE COMPANY LIMITED (“Company”), subject to market conditions and other considerations is proposing a public issue of Secured, Rated, Listed, Redeemable Non-Convertible Debentures of face value of Rs. 1,000 each (“NCDs”) and has led the Shelf Prospectus dated April 19, 2023 (the "Shelf Prospectus") and the Tranche I Prospectus dated April 19, 2023 (the "Tranche I Prospectus'') with the Registrar of Companies, Tamil Nadu at Chennai, National Stock Exchange of India Limited, BSE Limited and SEBI. The Shelf Prospectus and the Tranche I Prospectus are available on the Company’s website www.cholamandalam.com; on the website of the stock exchanges at www.nseindia.com and www.bseindia.com; on the website of SEBI at www.sebi.gov.in and the website of the lead manager at www.akgroup.co.in. Investors proposing to participate in the Tranche I Issue, should invest only on the basis of the information contained in the Shelf Prospectus and the Tranche I Prospectus. Investors should note that investment in this Public Issue of NCDs involves a high degree of risk and for details relating to the same, please refer to the Shelf Prospectus and the Tranche I Prospectus and your attention is drawn to the section on “Risk Factors” beginning on page 15 of the Shelf Prospectus.
GENERAL RISKS: Investment in debt securities involve a degree of risk and investors should not invest any funds in such securities unless they can afford to take the risk attached to such investments. Investors are advised to take an informed decision and to read the risk factors carefully before investing in this offering. For taking an investment decision, investors must rely on their examination of the issue including the risks involved in it. Specific attention of investors is invited to statement of risk factors contained under “Risk Factors” on page 15 of the Shelf Prospectus and “Material Developments” on page 227 of the Shelf Prospectus and page 35 of the Tranche I Prospectus. These risks are not, and are not intended to be, a complete list of all risks and considerations relevant to the debt securities or investor’s decision to purchase such securities. The Tranche I Prospectus has not been and will not be approved by any regulatory authority in India, including the Securities and Exchange Board of India (“SEBI”), the Reserve Bank of India (“RBI”), RoC or any stock exchange in India nor do they guarantee the accuracy or adequacy of this document.
DISCLAIMER CLAUSE OF BSE: It is to be distinctly understood that the permission given by BSE Limited should not in any way be deemed or construed that the Draft Offer Document has been cleared or approved by BSE Limited nor does it certify the correctness of any of the contents of the Prospectus. The investors are advised to refer to the Draft Offer Document/ Offer Document for the full text of the Disclaimer clause of the BSE Limited.
DISCLAIMER CLAUSE OF NSE: It is to be distinctly understood that the permission given by NSE should not in any way be deemed or construed that the Offer Document has been cleared or approved by NSE nor does it certify the correctness or completeness of any of the contents of the Offer Document. The investors are advised to refer to the Offer Document for the full text of the 'Disclaimer Clause of NSE”.
DISCLAIMER CLAUSE OF INDIA RATINGS & RESEARCH PRIVATE LIMITED: All credit ratings assigned by India Ratings are subject to certain limitations and disclaimers. Please read these limitations and disclaimers by following this link: https://www.indiaratings.co.in/rating-definitions. In addition, rating definitions and the terms of use of such ratings are available on the agency's public website www.indiaratings.co.in. Published ratings, criteria, and methodologies are available from this site at all times. India Ratings’ code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance, and other relevant policies and procedures are also available from the code of conduct section of this site. (https://www.indiaratings.co.in/rating-definitions) (https://www.indiaratings.co.in).
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Allotments on first come first serve basis: Allotments, in consultation with the Designated Stock Exchange, shall be made on date priority basis i.e. a first-come first serve basis, based on the date of upload of each Application in to the Electronic Book with Stock Exchanges in accordance with the SEBI Operational Circular, in each Portion subject to the Allocation Ratio indicated in the Tranche 1 Prospectus. However, from the date of oversubscription and thereafter, the allotments will be made to the applicants on proportionate basis. For further details refer section titled “Issue Procedure” on page 55 of the Tranche I Prospectus dated April 19, 2023.
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