Muthoottu Mini Financiers is currently coming up with collateralized NCD bonds. These NCD bonds will begin offering on October 30, 2024 and will close on November 4, 2024. Muthoottu Mini Financiers is a non-deposit-taking NBFC-ML in India focused on providing loans for pawning of gold jewelery for household use. The interest rate is up to 10% and the yield is up to 10.5%. These NCDs are in the 7 series and are offered in terms of 450 days to 66 months. These interests are paid monthly or at maturity. Should I invest in Muthoottu Mini Financiers NCD Oct-24? What are the risk factors for these NCDs?In this article, we will review Muthoottu Mini Financiers Ltd NCD.
About Muthoottu Mini Financiers Limited
They offer funds against household gold jewelery collateral in Kerala, Tamil Nadu, Karnataka, Andhra Pradesh, Telangana, Haryana, Maharashtra, Gujarat, Delhi and Uttar Pradesh. A non-deposit-taking NBFC-ML in the gold loan sector that lends. Union Territories of Goa and Pondicherry.
It also has a microfinance loan segment, which provides unsecured loans through several branches in Kerala to women customers (minimum of five) in joint liability groups who require funds to carry out their business activities.
As of March 31, 2024, the states of Kerala, Tamil Nadu, Karnataka, Andhra Pradesh, Telangana, Haryana, Maharashtra, Gujarat, Delhi, Uttar Pradesh, Goa and Puducherry , has a network of 902 branches spread across the Union Territories. Business operations employ 4,563 people.
Muthoottu Mini Financiers NCD October 2024 issue details
| opening day | October 30, 24 |
| Closing date | November 13, 24 |
| Issued securities name | Muthoottu Mini Financhaise Limited |
| Type of security | Secured, redeemable, non-convertible debentures (Secured NCDs) |
| Publication size (base) | 100 million rupees |
| oversubscription | 5 billion rupees |
| Total publication size | 150 million rupees |
| Issue price | 1,000 rupees per deposit |
| face value | 1,000 rupees per deposit |
| minimum lot size | 10 bonds and then 1 bond |
| series | Ⅰ～Ⅶ |
| Interest payment frequency | Monthly and cumulative |
| Listed | Within 6 business days for BSE |
| lead manager | Vivro Financial Services Private Limited |
| bond trustee | Mitcon Credencia Trusteeship Services Limited |
interest rate
| series | I | II | Ⅲ | Ⅳ | V | VI | VII |
|---|---|---|---|---|---|---|---|
| Interest payment frequency | monthly | monthly | cumulative | monthly | cumulative | monthly | cumulative |
| tenor (monthly) | 450 days | 26 | 26 | 36 | 36 | 48 | 66 |
| Coupon (% per year) | 8.50% | 9.00% | N.A. | 9.50% | N.A. | 10.00% | N.A. |
| Effective yield (%/year) | 8.84% | 9.38% | 9.40% | 9.92% | 9.75% | 10.47% | 10.50% |
| Amount at maturity (Rs.) | 1,000.00 | 1,000.00 | 1,215.00 | 1,000.00 | 1,322.00 | 1,000.00 | 1,732.00 |
credit rating
These NCDs are rated CARE A- Stable by CARE, which indicates that instruments with this rating are considered to be sufficiently secure with respect to timely repayment of financial obligations and have low credit risk.
company finances
The company’s revenue for FY24 increased by 23.4% and profit by 15.7% over the previous year. The asset details, revenue and profits for the past three years are as follows:
corporate promoter
Nizzy Mathew and Mathew Muthottu are the promoters of the company.
Why invest in Muthoottu Mini Financiers NCD?
- The interest rates on Muthoottu Mini NCD are attractive and investors can earn up to 10% interest and yield up to 10.5% per annum.
- Muthoottu Mini Financiers generate consistent revenue and margin growth. Investors should always invest in growing companies.
- Issue a secure NCD. These NCDs are safe compared to unsafe NCDs. If a company goes into financial trouble and dissolves or goes out of business, safe NCD investors can preferentially repay their capital with interest as it is backed by the company’s assets. Therefore, it is safe to invest in such safe NCD options.
Interested in investing in Muthoottu Mini Financiers NCD?
- Muthootu Mini Financiers credit rating upgraded from CARE BBB+: Stable to CARE A-: Stable in July 2022. There can be no assurance that such ratings will continue or be upgraded in the future.
- We are subject to inspection by the RBI and any adverse action could affect our business.
- These companies are subject to certain legal proceedings, and adverse decisions in such proceedings could have a material adverse effect on their operations.
- They do not own any trademarks licensed for use by any of their group companies. Termination or withdrawal of this license on unfavorable terms or any negative impact on the Muthoottu Mini brand could have an adverse effect on its business and reputation.
- Its operations are capital intensive, and disruptions or restrictions in its financing could have a material adverse effect on its liquidity and financial condition.
- Its financial performance depends primarily on interest rate risk. If we are unable to manage interest rate risk in the future, our net interest margin could be adversely affected and our business and financial condition could be affected.
- Our debt-to-equity ratio is high, and any further increase in borrowings could have a material adverse effect on our business and financial condition.
- refer Muthoottu Mini Financiers NCD Oct-24 Prospectus Addresses complete risk factors.
How can I subscribe to these NCDs?
This issue is available only in demat format. You can apply online or through the website of the broker where you maintain your demat account. Please refer to the prospectus for further details.
Should you invest in Muthoottu Mini Financiers NCD October-2024?
Muthoottu Mini Financiers NCD issued on October 24th has high interest rate. These NCDs are rated A-: Stable by CARE, which is good. However, such ratings were raised several years ago. Such credit ratings may change in the future. High-risk investors can invest in these safe NCDs. Medium to low risk investors should avoid such NCDs.
Suresh KP is the founder of Myinvestmentideas. He is a NISM Certified – Investment Advisor and a NISM Certified – Research Analyst. I have been analyzing financial markets for the past 20 years. He can be reached at suresh@myinvestmentideas.com.
