● Effective yield of up to 9.99% per annum for Series VI
● Credit Rating: CRISIL AA-/Positive by CRISIL Ratings Limited
● Tranche I Issue opens on December 7, 2023 and closes on December 20, 2023 with an option for early closure as decided by the Board of Directors or Asset Liability Committee of the Company and subject to relevant approvals
● NCDs will be traded in dematerialised form
● Allotment on first cum first serve basis. However, from the date of oversubscription and thereafter, the allotments will be made to the applicants on proportionate basis.
Arka Fincap Limited has announced public issue of secured, rated, listed, redeemable non-convertible debentures of face value of ₹ 1,000 each (“NCDs” or “Debentures”) for an amount of ₹ 15,000 lakh (“Base Issue Size”) with an option to retain oversubscription up to an amount of ₹ 15,000 lakh (“Green Shoe Option”) amounting to ₹ 30,000 lakh (“Tranche I Issue Limit”) (“Tranche I Issue”). The Lead Managers to the Issue are JM Financial Limited and Nuvama Wealth Management Limited (formerly known as Edelweiss Securities Limited).
Mr. Vimal Bhandari, Executive Vice Chairman & CEO, Arka Fincap Limited said, “We are delighted to launch the Tranche I Issue of the NCDs. We are a professionally managed organization part of the Kirloskar Group, primarily engaged in providing structured secured term financing solutions to corporates, real estate and urban infra financing, loans to SMEs & MSMEs and personal finance loans to borrowers in India. With our focus on our customers, experienced management team and vigilant monitoring of our assets, our business has experienced growth since the commencement of our operations in Fiscal 2019. We believe that we have a well-diversified funding profile that underpins our strong liquidity management system, our strong credit rating and brand equity. The public issue of NCDs is in line with our strategy of liability diversification.
The NCDs offer Coupon Rate ranging from 9.00% to 10.00% per annum with quarterly and annual interest option. The NCDs have three tenors of 24 months, 36 months and 60 months. Please refer to the table on Issue Structure below on coupon rates and tenors for each series of NCDs. The NCDs are proposed to be listed on BSE Limited.
At least 75% of the funds raised through this Tranche I Issue will be used for the purpose of onward lending, financing, and for repayment of interest and principal of existing borrowings of the Company and the balance is proposed to be utilized for general corporate purposes, subject to such utilization not exceeding 25% of the amount raised in the Tranche I Issue, in compliance with the Securities and Exchange Board of India (Issue and Listing of Non-Convertible Securities) Regulations, 2021 (“SEBI NCS Regulations”).
Issue structure
| Series | I | II | III | IV* | V | VI |
| Frequency of Interest Payment | Quarterly | Annual | Quarterly | Annual | Quarterly | Annual |
| Minimum Application | ₹ 10,000 (10 NCDs) across all series | |||||
| In Multiples of thereafter | ₹ 1,000 (1 NCD) | |||||
| Face Value/ Issue Price of NCDs (₹/ NCD) | ₹ 1,000 | |||||
| Tenor | 24 Months | 24 Months | 36 Months | 36 Months | 60 Months | 60 Months |
| Coupon (% per annum) for NCD Holders in all Categories | 9.00% | 9.30% | 9.30% | 9.65% | 9.65% | 10.00% |
| Effective Yield (% per annum) for NCD Holders in all Categories | 9.29% | 9.29% | 9.62% | 9.64% | 9.99% | 9.99% |
| Mode of Interest Payment | Through various modes available | |||||
| Redemption Amount (₹ / NCD) on Maturity for NCD Holders in all Categories | ₹ 1,000 | ₹ 1,000 | ₹ 1,000 | ₹ 1,000 | ₹ 1,000 | ₹ 1,000 |
| Maturity/Redemption Date (from the Deemed Date of Allotment) | 24 Months | 24 Months | 36 Months | 36 Months | 60 Months | 60 Months |
| Put and Call Option | Not Applicable | |||||
* The Company shall allocate and allot Series IV NCDs (Annual Option) wherein the Applicants have not indicated the choice of the relevant NCD Series
About Arka Fincap Limited:
Arka Fincap Limited, is an NBFC-ML registered with RBI. It is a professionally managed organization part of the Kirloskar Group, primarily engaged in providing structured term financing solutions to corporates, real estate and urban infra financing, loans to micro, small and medium enterprise (“MSME”) and personal finance loans to borrowers in India. It operates four principal lines of business, namely corporate lending, real estate and urban infra financing, MSME lending and personal lending. Its total Loan Book as of September 30, 2023was ₹ 4,03,319.32 lakh.
