Non-banking finance company (NBFC) IIFL Finance Ltd has raised up to Rs 1,000 crore in a public offering of secured non-convertible debentures (NCDs) on December 6.

IIFL Finance’s products include housing loans, gold loans, business loans, real estate loans, SME financing, microfinance, construction and real estate financing, and capital market financing, serving retail and corporate clients.

The Fairfax-backed NBFC will issue secured NCDs worth Rs 100 crore with a greenshoe option to retain up to Rs 900 crore oversubscription for a total of Rs 100 crore. Assignments will be made on a first-come, first-served basis.

The NCD offers a maximum effective yield of 9% per annum over a 60-month term. NCDs are available in terms 24, 36 and 60 months. Interest payment frequency is monthly, yearly, and due date (60 months), while other terms are annual and due date.

The company is raising capital for ongoing lending, financing, refinancing and general corporate purposes of its existing debt.

IIFL Finance Group raised Rs 3,000 crore through public bond offerings in 2011-14 and has repaid all investors with capital and interest on time.

Also, since FY19, the group has raised around Rs 4,000 crore through public bond offerings, of which Rs 1,325 crore has been repaid.

The company has raised capital through public offerings and coupons of various maturities over the past few years, with the last round in October 2021. The company offers returns as high as 8.75% per annum. The tenor is up to 60 months and raised Rs 843 crore from the offering.

The NCD issue has been rated AA by Crisil Ltd and ICRA Ltd with a stable outlook. The rating indicates that these instruments are highly secure in repaying financial obligations promptly and carry low credit risk.

IIFL Finance claims it has maintained a low level of non-performing assets (NPA) and continues to focus on high-quality assets, with a gross NPA of 2.42% and a net NPA of 1.22%. In addition, as of September 30, 2022, 85.03% of the company’s consolidated loan book was backed by sufficient collateral, helping to reduce risk further.

NCD guarantees 100% of the company’s loan assets and other receivables. The company’s core loan products include gold loans.