Unifinz Capital Issues Rs 50 Crore in Secured NCDs

Unifinz Capital India has allotted 50,000 NCDs to raise Rs 50 crore through a private placement.
The issuance carries an 11% fixed annual coupon paid monthly and matures on January 8, 2028.

Reader Takeaway: Investors gain an 11% yield backed by a 1.10x asset cover, but must watch operational cash flows.

What just happened

Unifinz Capital India Ltd has completed a private placement of 50,000 senior, secured, rated non-convertible debentures (NCDs) at an issue price of Rs 10,000 each. The issuance was approved by the company's Asset Liability Management Committee to mobilize Rs 50 crore for business operations. The debentures carry an 11% annual coupon paid monthly, with a tenure of 15 months, maturing in January 2028.

Why this matters

This debt issuance provides Unifinz Capital with liquidity to fuel its loan book expansion. For investors, the instrument offers a fixed income stream with the added security of a first-ranking, exclusive charge over identified loan receivables. The requirement to maintain a 1.10x security cover throughout the tenure serves as a risk-mitigation layer for debenture holders.

Risks to watch

Key risks include potential liquidity constraints in the underlying loan portfolio and the company's ability to maintain the stipulated 1.10x security cover. Should a default on interest or principal payments occur, the company is contractually obligated to pay an additional penalty interest of 4% per annum above the existing coupon rate, highlighting the critical nature of timely repayment.

Context metrics

• Instrument Type: Senior, Secured, Listed NCDs
• Credit Rating: IND BBB-/Stable (India Ratings)
• Coupon Payment: Monthly
• Security: Exclusive charge on book debts and loan receivables