JM Financial Credit Solutions Limited NCD Issue to open on 28th May

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Attractive interest rate of up to 9.75% per annum*

Ratings – [ICRA] AA/Stable by ICRA and IND AA/Stable by India Ratings – indicate high degree of safety regarding timely servicing of financial obligations. Minimum application size Rs. 10,000 collectively across all Options ranging from 38 to 120 months. Allotment on first-come, first-served basis. Investors have an option to apply for NCDs only indematerialized form. No TDS applicable for NCDs held in dematerialized form.

JM Financial Credit Solutions Limited (the “Company”), the NBFC arm of the JM Financial Group providing integrated financial solutions to real estate developers, proposes to open on 28th May, a public issue of secured, rated, listed redeemable, Non-Convertible Debentures of face value of Rs. 1,000 each (“Secured NCDs”) with a Base Issue size of Rs. 300 crore with an option to retain oversubscription upto Rs. 450 crore aggregating upto Rs. 750 crore (“Tranche I Issue”), which is within the Shelf Limit of Rs. 2,000 crore.

The Issue is scheduled to close on 20th June with an option of early closure or extension as decided by the Board of Directors of the Company (“Board”) or the NCD Public Issue Committee.

Ratings by ICRA & India Ratings indicate ‘High degree of safety’

The Secured NCDs proposed to be issued under the Tranche I Issue have been rated [ICRA] AA/Stable by ICRA for an amount of upto Rs. 2,000 crore vide its letter dated 27th April and further reaffirmed by letter dated 11th May and have been rated IND AA/Stable by India Ratings for an amount Rs. 2,000 crore vide its letter dated 27th April which has been superseded by letter dated 10th May. The rating of the Secured NCDs by ICRA and India Ratings indicates high degree of safety regarding timely servicing of financial obligations.

Shashwat Belapurkar, CEO, JM Financial Credit Solutions Limited, said, “JM Financial Credit Solutions Ltd.’s Public Issue of NCDs has the distinction of being the first from JM Financial group, an established financial services group with a recognised and trusted brand. Our Company has a track record of stable and sustainable financial performance reflected in our consistent growth in revenues and profitability coupled with a conservative debt equity ratio and strong asset quality. Our total revenue increased at a CAGR of 109.9% from Fiscal 2015 to Fiscal 2018 and our profit after tax increased at a CAGR of 88.8% from Fiscal 2015 to Fiscal 2018. Our NCD Issue is a significant step to optimize funding costs and maintain a diverse funding portfolio that will enable us to achieve funding stability and liquidity in a fast growing market full of opportunities.”

CRISIL Research anticipates wholesale financing by NBFCs to grow at 23% to 26% CAGR over the next two years to ₹ 2.0 trillion by Fiscal 2019. Over the next five years, CRISIL expects NBFCs assets to grow by 20% to 25% CAGR from Fiscal 2017 to Fiscal 2022 due to increasing need for funds post implementation of Real Estate (Regulation and Development) Act, 2016 (“RERA”).

The minimum application amount is Rs.10,000 collectively across all options on NCDs and in multiples of One (1) NCD of face value of Rs. 1000 each after the minimum application. Allotment is on a first-come-first-serve basis (except on the date of oversubscription, if any, when all the investors applying on the said date will get allotment on a proportionate basis). Investors have to apply for NCDs only in dematerialized form.

Issue Structure:

In Option 1, interest will be paid on an annual basis at a rate of 9.25%; and the tenor is 38 months. The Effective Yield (per annum) is 9.26%.

In Option II, interest will be paid on a cumulative basis and the tenor is 38 months. The redemption amount per NCD is Rs. 1,323.39.

In Option III, interest will be paid on an annual basis at a rate of 9.50% and the tenor is 60 months. The Effective Yield (per annum) is 9.49%.

In Option IV, interest will be paid on a monthly basis at a rate of 9.11% and the tenor is 60 months. The Effective Yield (per annum) is 9.49%.

In Option V, interest will be paid on an annual basis at a rate of 9.75% and the tenor is 120 months. The Effective Yield (per annum) is 9.74%.

In Option VI, interest will be paid on a monthly basis at a rate of 9.34% and the tenor is 120 months. The Effective Yield (per annum) is 9.74%.

[Category IV Investors (Retail Individual Investors) are defined as Resident Indian individuals and HUFs through the Karta applying for an amount aggregating for an amount up to and including Rs. 10 lakh, across all Series of NCDs. Category III Investors (High Net-worth Individuals or HNIs) Investors are Resident Indian individuals and HUFs through the Karta applying for an amount above Rs. 10 lakh, across all Series of NCDs].

Atleast 75% of the net proceeds of the Public Issue of NCDs will be used for the purpose of onward lending, financing, and for repayment/ prepayment of interest and principal of existing borrowings of the Company. A maximum of up to 25% will be used for general corporate purposes.

The NCDs offered through the Shelf Prospectus and the Tranche I Prospectus are proposed to be listed on BSE Limited.

The Lead Managers to the Issue are A. K. Capital Services Ltd., JM Financial Limited, Edelweiss Financial Services Limited and Trust Investment Advisors Private Limited. In compliance with the proviso to Regulation 21A(1) of the Securities and Exchange Board of India (Merchant Bankers) Regulations, 1992, as amended, read with proviso to Regulation 5(3) of the SEBI ICDR Regulations, JM Financial Limited will be responsible only in marketing of the Issue.

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