Mumbai :Government owned Industrial Finance Corporation of India Ltd (IFCI) is coming 
out with its first tranche of Rs. 250 crore NCD with an option to retain oversubscription of Rs. 2,000 crore. The issue opens for subscription on October 20 and closes on November 21.
The company is offering an effective yield rangi6ng from 9.8%å p.a. to 10% p.a. depending on the category of investors and series of NCDs applied for.
Its CEO & Managing Director Malay Mukherjee had said.
The NCDs will come in tenures of 5, 7 and 10 years, and would be listed in both the BSE and National Stock Exchange, Mukherjee told here.
CHANGE OF TACK
IFCI initially wanted to list the NCDs on the BSE Ltd only. It has now decided to list them on both the BSE and NSE, Mukherjee said.
Listing on both bourses would be useful as it would provide investors a wider trading platform, he said.
IFCI is an original promoter of NSE, the country’s largest bourse by profits.
ISSUE SIZE, COUPON
This IFCI NCD offering — which will be open for one month from Monday next — will have an issue size of ₹250 crore, with a green shoe option of up to ₹2,000 crore.
Each bond will have a face value of ₹1,000 each.
Retail investors in this NCD issue will get a coupon of 9.9-10 per cent per annum.
On the other hand, wholesale investors could get a coupon of 9.4-9.8 per cent per annum.
As much as 75 per cent of the sum mobilised is proposed to be used for lending, with the balance being utilised for general corporate purposes.
Incorporated in May 1993, IFCI is a Government of India controlled company registered with the Reserve Bank of India (RBI) as a Systemically Important Non-Deposit taking NBFC (NBFC-NDSI). IFCI provides financial services which include, besides long term corporate loans, advisory services in the areas of project development, project appraisal, strategic analysis, corporate restructuring, infrastructure financing and legal advisory to various sectors.
Effective yield and maturity
Tentative brokerage structure: Sub brokers can expect commission of up to 1% which depends on the issue term and number of applications.
Lead managers: SBI Capital Markets, A K Capital Services, Edelweiss Financial Services, RR Investors Capital Services
Listing: BSE & NSE
Minimum application: 10 NCDs (Rs. 10,000) and in the multiple of one NCD thereafter
Rating: BWR AA- (Outlook: Stable)” by Brickwork Ratings and “[ICRA] A (Stable)” by ICRA
Who can sell the product: Registered stock brokers with any stock exchange along with their respective sub-brokers, banks and intermediaries selected by the issuing company.
How can an IFA get registered to sell the product: An IFA has to sign the sub-broker agreement with a stock broker to be eligible to sell these NCDs.
Source : Sachin Murdeshwar