Arka Fincap launches its maiden public issue of NCDs of INR 300cr

 

Mumbai: “Arka Fincap Limited” has announced public issue of secured, rated, listed, redeemable non-convertible debentures of the face value of ₹ 1,000 each (“NCDs” or “Debentures”) for an amount of ₹ 15,000 lacks (“Base Issue Size”) with an option to retain over subscription up to an amount of ₹15,000 lacks (“Green Shoe Option”) amounting to ₹ 30,000 lakh (“Tranche I Issue Limit”) (“Tranche I Issue”).

The Lead Managers to the Issue are JM Financial Limited and Nuvama Wealth Management Limited (formerly known as Edelweiss Securities Limited).

Mr. Vimal Bhandari, Executive Vice Chairman & CEO, of Arka Fincap Limited said, “We are delighted to launch the Tranche I Issue of the NCDs. We are a professionally managed organization part of the 'Kirloskar Group', primarily engaged in providing structured secured term financing solutions to corporates, real estate, and urban infra financing, loans to SMEs & MSMEs, and personal finance loans to borrowers in India. With our focus on our customers, experienced management team, and vigilant monitoring of our assets, our business has experienced growth since the commencement of our operations in Fiscal 2019. We believe that we have a well-diversified funding profile that underpins our strong liquidity management system, our strong credit rating, and brand equity. The public issue of NCDs is in line with our strategy of liability diversification.

The NCDs offer Coupon Rates ranging from 9.00% to 10.00% per annum with quarterly and annual interest options. The NCDs have three tenors 24 months, 36 months, and 60 months. Please refer to the table on Issue Structure below on coupon rates and tenors for each series of NCDs. The NCDs are proposed to be listed on BSE Limited.

At least 75% of the funds raised through this Tranche I Issue will be used for onward lending, financing, and repayment of interest and principal of existing borrowings of the Company and the balance is proposed to be utilized for general corporate purposes, subject to such utilization not exceeding 25% of the amount raised in the Tranche I Issue, in compliance with the Securities and Exchange Board of India (Issue and Listing of Non-Convertible Securities) Regulations, 2021 (“SEBI NCS Regulations”).

Issue structur:

Series	I	II	III	IV*	V	VI
Frequency of Interest Payment	Quarterly	Annual	Quarterly	Annual	Quarterly	Annual
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	24 Months	24 Months	36 Months	36 Months	60 Months	60 Months
Coupon (% per annum) for NCD Holders in all Categories	9.00%	9.30%	9.30%	9.65%	9.65%	10.00%
Effective Yield (% per annum) for NCD Holders in all Categories	9.29%	9.29%	9.62%	9.64%	9.99%	9.99%
Mode of Interest Payment	Through various modes available
Redemption Amount (₹ / NCD) on Maturity for NCD Holders in all Categories	₹ 1,000	₹ 1,000	₹ 1,000	₹ 1,000	₹ 1,000	₹ 1,000
Maturity/Redemption Date (from the Deemed Date of Allotment)	24 Months	24 Months	36 Months	36 Months	60 Months	60 Months
Put and Call Option	Not Applicable

* The Company shall allocate and allot Series IV NCDs (Annual Option) wherein the Applicants have not indicated the choice of the relevant NCD Series