Muthoottu Mini Financiers launches NCD issue to raise ₹150 crore. Check key details

NCDs in 2024: Muthoottu Mini Financiers Limited is raising up to ₹150 crore through a public issue of secured non-convertible debentures (NCDs). With a base size of ₹100 crore, the issue allows for an additional ₹50 crore through oversubscription.

The NCDs, with a face value of ₹1,000 each, are open for subscription from October 30, 2024, until November 13, 2024. The company has the option to close the issue early, pending approvals that are in line with SEBI regulations. Once issued, the NCDs are set to be listed on the BSE.

Interest rates & tenures

The NCDs offer annualised interest rates between 8.84% and 10.5%, depending on the tenure and category. Tenure options include 450 days, 26 months, 36 months, 48 months, and 66 months. Funds raised will go toward onward lending, financing, repayment of borrowings, and general corporate needs.

Credit rating

CARE Ratings has assigned the NCDs a rating of "CARE A- Stable," signalling a stable outlook with low credit risk.

Company profile & financial performance

Headquartered in Kochi, Kerala, Muthoottu Mini Financiers primarily provides gold loans, along with other financial services such as insurance, money transfer, depository participant, and microfinance services, primarily targeting rural and semi-urban customers. The company operates across 920 branches in 10 states, including Delhi and Puducherry, serving over 562,000 customers.

In FY24, Muthoottu Mini reported assets under management (AUM) of ₹3,523 crore and a profit after tax (PAT) of ₹77.83 crore. The gold loan segment remains the backbone of its portfolio, comprising 91.47% of total loans, amounting to ₹3,222 crore as of March 31, 2024.

Over the past three fiscal years, Muthoottu Mini has recorded significant growth in AUM and PAT. AUM rose by 41% from ₹2,498 crore in FY22 to ₹3,523 crore in FY24, while PAT surged by 68% from ₹46.29 crore to ₹77.83 crore. The capital adequacy ratio (CAR) stood at 23.86% as of March 2024, well above regulatory requirements.

The company’s gross non-performing assets (GNPA) have stayed low, with FY24 figures at 0.88%, indicating a stable risk profile in its loan portfolio.