Nido Home Finance Limited (formerly known as Edelweiss Housing Finance Limited) is currently issuing secured NCD bonds. The company is a deposit-free housing finance company that provides credit to its customers on various types of loans. Nido Home Finance NCDs offer interest rates of up to 11%. These NCDs are offered for tenors ranging from 24 to 120 months. Interest is payable monthly or annually or at maturity, depending on the NCD option. Should you invest in Nido Home Finance NCD September 2024? What are the risk factors to consider before investing in Nido Home Finance NCD 2024?
About Nido Home Finance Limited
We are a non-deposit taking mortgage finance company focused on providing secured loan products tailored to individual needs, including small loans to customers in the affordable housing sector.
The company is part of the Edelweiss Group, one of India’s leading diversified financial services groups. Nido Home Finance Limited was earlier known as Edelweiss Housing Finance Limited.
The company offers a variety of mortgage-related loan products to its customers, including:
Mortgageprovides secured loans to salaried workers, self-employed individuals, etc. for the purchase, construction, renovation, etc. of residential properties, using the same property as collateral. As of March 31, 2023, it accounted for 56.97% of the outstanding loan balance, as of March 31, 2024, it accounted for 63.95% of the outstanding loan balance, and as of June 30, 2024, it accounted for 61.34% of the outstanding loan balance.
Non-mortgage loans, including loans secured by real estate (LAP)is a loan facility provided primarily to self-employed individuals against unsecured real estate as collateral, with the end use being for working capital allocation, purchase of real estate, or any other purpose. As part of the LAP, a concession on lease payments is also provided if the lessee is a legal entity.
Construction finance, A loan facility provided to real estate developers for the construction costs of housing projects. The loan is secured by the property and may or may not be secured by other collateral. Disbursement of the loan is linked to construction.
Nido Home Finance NCD – September 2024 – Issue Details
| Application start date | September 18, 2024 |
| Subscription End Date | October 1, 2024 |
| Name of Issuer | Nido Home Finance Co., Ltd. |
| Security Type | Secured Redeemable Non-Convertible Debentures (Secured NCDs) |
| Issue size (base) | 500 million rupees |
| Issue size (option to hold oversubscribed amounts) | 500 million rupees |
| Total Issue Amount | 100 crore |
| Issue price | 1,000 per bond. |
| Face value | 1,000 per bond. |
| series | From I to X |
| Minimum Lot Size | 10 bonds and then 1 bond |
| Tenure | 24, 36, 60, 120 months |
| Interest payment frequency | Monthly, annual, or maturity date |
| Published in | Within 6 business days on BSE |
| Lead Manager | Tipsons Consultant Services Pvt. Ltd. Nuvama Wealth Management Limited |
| Bond Trustee | Beacon Trusteeship Limited |
Nido Home Finance NCD – September 2024 – Interest Rates
| series | I | II | III. | IV | Five | VI | Seven | Eight | Chapter 9 | X |
|---|---|---|---|---|---|---|---|---|---|---|
| Frequency of interest payments | Annual | Accumulation | Monthly | Annual | Accumulation | Monthly | Annual | Accumulation | Monthly | Annual |
| Term of employment (months) | twenty four | twenty four | 36 | 36 | 36 | 60 | 60 | 60 | 120 | 120 |
| Coupon (annual interest rate) | 9.50% | N/A | 9.58% | 10.00% | N/A | 10.03% | 10.50% | N/A | 10.49% | 11.00% |
| Effective Yield (annual %) | 9.50% | 9.50% | 10.01% | 10.00% | 10.00% | 10.58% | 10.49% | 10.50% | 11.00% | 10.99% |
| Amount at maturity (Rupees) | 1,000.00 | 1,191.13 | 1,000.00 | 1,000.00 | 1,331.18 | 1,000* | 1,000* | 1,648.27 | 1,000* | 1,000* |
The redemption amounts are as follows:
Nido Home Finance NCD – September 2024 – Credit Rating
CRISIL Ratings has assigned Nido Home Finance NCD a rating of CRISIL A+/Watch Negative. Securities with this rating are considered to be adequately secure with regard to timely performance of financial obligations. Such securities have low credit risk.
What is the company’s profit situation?
The profits are as follows:
- FY21 – Rs 372 crore
- FY22 – Rs 138 crore
- 160.6 million rupees for FY2023
- 193 million rupees for FY24
Why Invest in Nido Home Finance NCD – Sep-2024?
- Nido Home Finance NCD offers attractive interest rates, allowing investors to earn up to 11% interest per annum.
- The company has been generating stable profits. Investors should always invest in companies that are growing and generating stable profits.
- The company issues secured NCDs. In case the company gets wound up/dissolved due to any reason, secured NCD investors get priority in repayment of capital along with interest backed by the assets of the company. Hence, it is safe to invest in such secured NCD options.
Want to invest in Nido Home Finance NCD – Sep-2024?
- As an HFC, we are subject to various regulations and laws, and future regulatory changes could have a material adverse effect on our business.
- These companies require significant amounts of capital for their operations, and any disruptions to their sources of capital could adversely affect their operations.
- Any adverse events affecting India’s real estate sector could adversely affect the collateral value of its loans, its business and results of operations.
- An increase in the level of non-performing assets for any reason will have an adverse effect on our business.
- We may face mismatches between our assets and liabilities, which could affect our liquidity and, as a result, adversely affect our business and financial performance.
- See also Nido Home Finance NCD September 24th Prospectus For complete risk factors.
Nido Home Finance NCD – Should You Invest in September 2024?
Nido Home Finance’s currently issued NCDs offer high interest rates and yields. Although banks are offering higher fixed deposit rates these days, these NCDs still offer high interest rates of up to 11%. The company is also earning steady profits on these secured NCDs.
Meanwhile, investors should not forget the risks involved in investing in NBFC bonds. Many NBFCs have previously defaulted on their debts, resulting in delays in repayment of principal and interest.
High-risk investors who are willing to consider all these risks can invest in such NCDs.
Suresh KP is the Founder of Myinvestmentideas. He is a NISM Certified Investment Advisor and NISM Certified Research Analyst. He has been involved in analyzing financial markets for the last 20 years. He can be reached at suresh@myinvestmentideas.com.
