Shriram Transport comes with secure high interest NCD issue

July 23, 2012   ·   0 Comments

 

 

Shriram Transport Finance Company Limited is coming out with a public issue of Secured, Redeemable, Non-Convertible Debentures (NCDs) of face value of Rs.1000/- each aggregating upto Rs. 300 Crores,  with an option to retain over subscription upto Rs. 300 crores  for issuance of additional NCDs, aggregating to a total of upto Rs. 600 crores.   The issue is opening for subscription on 26th July’2012 and closes on 10th August’2012. This will be the best fixed deposit interest rate in India at current comparison. 

Brief Introduction of the company:

  • Shriram Transport Finance Company (STFC) was established in 1979 and we have a long track record of over three decades in the commercial vehicle financing industry in India.
  • STFC has been registered as a deposit-taking NBFC with the RBI since September 4, 2000 under Section 45IA of the Reserve Bank of India Act, 1934.
  • STFC is a part of the Shriram group of companies which has a strong presence in financial services in India, including commercial vehicle financing, consumer finance, life and general insurance, stock broking, chit funds and distribution of financial products such as life and general insurance products and mutual fund products, as well as a growing presence in other businesses such as property development, engineering projects and information technology.
  • As of March 31, 2012 STFC had 502 branches across India, including at most of the major commercial vehicle hubs along various

 

Competitive Strengths:

  • The largest asset financing NBFC in India
  • Strong Risk and Credit Management System
  • Unique business model and track record of strong financial performance
  • Access to cost effective funding sources
  • Strong brand name

 

Unique Features:

  • Market Making: For the first time concept of market making is proposed and the Company has appointed Kotak Mahindra Capital Company Limited for exploring the possibility of market making for the offering subject to receipt of statutory approvals.
  • Reserved Individual Investors have the option to apply for NCD s in physical form
  • If Individual Investors (Reserved Individual Investors and Non Reserved Individual Investors) hold the NCDs on any record date, they shall be eligible to additional incentive in terms of interest in case of Series I and II and redemption premium amount in case of Series III and IV respectively.

 

Issue details:        
         
Shriram Transport Finance Company    
     
Issuer/ Borrower    
     
Issue Open July 26, 2012    
   
Issue Close August 10, 2012    
   
Issue Size Base issue size of ` 300 Crore, with an option to retain oversubscription of ` 300 Crore, aggregating to a total of ` 600 Crore    
   
Nature of Instrument Public Issue of Non-Convertible Debentures    
   
Credit Rating ‘AA (Stable)’ by CRISIL ‘AA+’ by CARE    
   
Issuance & Tading Dematerialised & Physical Form*    
   
Face Value Rs. 1,000    
   
Minimum Application 10,000/- or 10 NCDs    
   
High interest NCD issue 11.15% for tenure of 36 months,11.40% for tenure of 60 months

           

 http://stockssavvy.com

 

Verdict: In the falling interest rate scenario, we gives a thumbs up to the issue which is providing a secure high fixed interest rate. You can get in touch with us in case you want to apply for this NCD issue.

You can refer this link to know more about financial planning and power of Regular Savings: Power of Regular Savings

 

Check this link where i talked about financial goals taking into account of the inflation: Power of Regular Savings – Part 2

Rajesh Singla

Rajesh is the founder & CEO of Stockssavvy, Stocks analyst,financial advisor by choice,software engineer by fate,biker,gamer,cricket lover n enthusiastic person. He believes in doing things not just to get by but to get Ahead...

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