Regency Fincorp Ltd will raise Rs 50 crore through Non-Convertible Debentures (NCDs) at a 13.50% annual interest rate. The NCDs, maturing in 15 months, are secured and will be listed on BSE. This aims to fund business activities.
Regency Fincorp Plans Rs 50 Crore Fundraising Via NCDs
Regency Fincorp Ltd will raise Rs 50 crore via Non-Convertible Debentures (NCDs).
Regency Fincorp Ltd has announced plans to raise Rs 50 crore by issuing secured, rated, and listed Non-Convertible Debentures (NCDs).
What just happened
The company's Board of Directors approved a fundraising plan through the issuance of NCDs worth Rs 50 crore. These debentures will have a face value of Rs 10,000 each, totaling 50,000 units.
Why this matters
This fundraising will provide capital for the company's operations and growth initiatives. Investors can earn a 13.50% annual interest rate, with monthly interest payouts and quarterly principal repayments over the 15-month tenure. The NCDs are secured, offering a layer of protection.
The backstory
Regency Fincorp is involved in financial services. This NCD issuance is a move to raise funds for its business objectives, leveraging the debt markets.
What changes now
The company will proceed with the private placement of these NCDs through an Electronic Book Provider (EBP) platform. Catalyst Trusteeship Limited has been appointed as the debenture trustee, and Credora Partners Private Limited as the merchant banker.
Risks to watch
Investors should monitor the company's ability to service the debt, ensuring timely interest and principal payments. A penal interest rate of 5% per month will apply in case of default.
Peer comparison
NCDs at 13.50% offer a competitive yield in the current market. Companies in the NBFC and financial services sector often use NCDs for capital augmentation.