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Kerala-based NBFC firm Kosamattam Finance Ltd plans to raise up to Rs 200 crore through a public issue of non-convertible debentures (NCDs).
The firm, which is into gold loan financing, has filed initial documents with the Securities and Exchange Board of India (SEBI) for the approval of the public issue.
NCDs are loan-linked securities issued by a company and cannot be converted into stocks. They usually carry a higher interest rate than a convertible debenture.
As per the draft prospectus filed with SEBI, the firm would issue “secured, redeemable, non-convertible debentures and unsecured redeemable non convertible debentures of face value of Rs 1,000 each aggregating up to Rs 10,000 lakh...with an option to retain over-subscription up to Rs 10,000 lakh aggregating up to Rs 20,000 lakh’’.
Kosamattam plans to use the proceeds from the issue for the purpose of “onward lending and for repayment of interest and principal of existing loans as well as general corporate purposes’’.
“Our company is in the business of gold loan financing, and as part of our business operations, we raise/avail funds for onward lending and for repayment of interest and principal of existing loans,” Kosamattam said.
Vivro Financial Services is the lead manager to the issue, while IL&FS Trust Company is the debenture trustee. Karvy Computershare would act as the registrar to the issue, the offer documents showed.
According to the firm, the NCDs offered “are proposed to be listed on the BSE’’.
“Our company has obtained ‘in-principle’ approval for the issue from BSE...BSE shall be the Designated Stock Exchange for this issue,” it added.
Kosamattam Finance, a part of Mathew K Cherian-led Kosamattam Group, is into the business of lending money against jewellery in Kerala, Tamil Nadu, Karnataka, Andhra Pradesh, Delhi, Maharashtra, Gujarat, Telangana and in the Union Territory of Puducherry.
As on December 31, 2014, the firm had a network of 875 branches spread across states, including Kerala, Tamil Nadu, Karnataka, Andhra Pradesh and Delhi.
For the eight months ended November 30, 2014 the company’s total income stood at Rs 156 crore.
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