Indian firms raise `4,500 cr via NCDs

Indian companies have mopped up close to Rs 4,500 crore via retail issuance of non-convertible debentures (NCDs) till 18 September in the current fiscal, primarily to meet their working capital requirements.

The capital mopped up through this route exceeded the targets during the April-September period of 2014-15.

About Rs 42,383 crore had been garnered through 35 issues of non-convertible debentures  in the entire last fiscal, 2013-14.

Non-convertible debentures  are loan-linked bonds that can't be converted into stock and usually offer higher interest rates than convertible debentures.

Most of the funds have been raised to support the working capital requirements and for other general corporate purposes.

Firms including Shriram City Union Finance, Kosamattam Finance, SREI Infrastructure Finance, ECL Finance, Midland Microfin and Muthoot Finance collectively raised Rs 4,439 crore via non-convertible debentures  in the current fiscal year through 12 issuances, as per data from the Securities and Exchange Board of India (Sebi).

This was more than the initially targeted Rs 1,850 crore. Shriram Transport Finance Company raised Rs 1,967 crore, as against the target of Rs 500 crore; Muthoot Finance mopped- up Rs 466 crore, against a base size of Rs 250 crore, and ECL Finance garnered Rs 400 crore as against Rs 200 crore.

Besides, Muthootu Mini Financiers raked in Rs 250 crore against a target of Rs 125 crore, Muthootu 

Fincorp mopped-up Rs 194 crore against the base size of Rs 100 crore.

Muthoot Finance tapped the non-convertible debentures  route more than once. During the year-ago period (April-September 2013-14) companies — SREI Infrastructure Finance, Shriram Transport Finance Company, Rural Electrification Corporation and Muthoot Finance — had raised Rs 4,713 crore.