Navi Finserv Ltd (NFS), a wholly-owned subsidiary of Navi Technologies Ltd, has announced the public issue of secured, rated, listed and redeemable non-convertible debentures (NCDs) amounting to ₹600 crore with a base issue of ₹300 crore and an option to retain over-subscription of another ₹300 crore.
The issue will open on May 23 and is scheduled to close on June 10 with an option of early closure or extension. The proposed NCDs have a rating of A (Stable) by India Ratings & Research Pvt Ltd. This rating is considered to have adequate degree of safety regarding timely servicing of financial obligations. Such instruments carry low credit risk.
Investors get an opportunity to participate in secured NCDs under various series for tenure of 18 months and 27 months with an effective yield of up to 9.80 per cent and a minimum application size of ₹10,000.
Speaking about the NCD issue, Ankit Agarwal, Managing Director of NFS, said, “The upcoming NCD issue aims to raise funds for onward lending and financing purposes. This will further diversify our borrowing profile and add more retail investors to our portfolio to complement our wide base of institutional partners. This is a secured instrument with A (stable) rating, a low application size and an effective yield of up to 9.80 per cent*.
Sachin Bansal, Chairman and CEO of NFS, added, “I believe that our customer-centric and technology-first approach, along with our robust underwriting and collections capabilities, add value to Navi Finserv’s maiden public debt issue.”
Financial performance
NFS offers personal loans and home loans under the “Navi’‘ brand and is said to have approved personal loans to customers across over 84 per cent of all Indian pin codes. The company’s net worth stood at ₹1189.6 croreas of December 31, 2021, and maintained a standalone debt to equity ratio of 2.1x as on December 31, 2021.
NFS has a Net NPA of 0.08 per cent (as of December 31, 2021), which is supported by a collections efficiency of 96.63 per cent (for personal loans disbursed subsequent to April 1, 2021, till December 31, 2021). Its outstanding borrowings on a standalone basis of ₹2,775 crore as of March 31, 2022, were diversified across an array of instruments such as NCDs, sub-debt, term loans, market-linked debentures, commercial papers and securitisation instruments.