Janalakshmi Financial Services Pvt Ltd has raised Rs 125 crore through listed, non-convertible bond issue. This is the first tranche of a total of Rs 250 crore that the micro finance institution intends to raise by the end of this month.

The bonds are rated A- by ICRA and are placed on a private placement basis with domestic institutional investors in India, a press release said. Janalakshmi intends to use the proceeds of the offering for its business purposes of financing the urban poor.

This is one of the largest syndicated local currency bond issues by a micro-finance institution in India targeting non-bank investors. The bond issue is part of a larger exercise to broad base investors, the company said. The issuances are being structured in various tranches from 18 months to three year tenors over coming months to be widely distributed to a number of long term institutional investors. Deutsche Bank is acting as sole arranger and bookrunner for the offering.  

Janalakshmi also closed an NCD from FMO, The Netherlands Development Finance Company for Rs 200 crore last month. Janalakshmi has entered into an agreement to borrow US$10 mn from a US-based company before March 2015, fulfilling all the regulatory requirements of the RBI. All these initiatives demonstrate Janalakshmi’s intention to diversify their sources of funding, to further expand their business of financing the unbanked urban poor in the country.

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