IIFL Finance, India’s largest retail focused Non-Banking Financial Companies, today said its bonds which offers up to 10.03% yield, effectively doubling investment in 87 months will close on March 18, 2021.
The Fairfax and CDC Group backed IIFL Finance’s unsecured redeemable non-convertible debentures (NCDs), aims to raise up to Rs 1000 crore. It has already seen very good response from investors across India due to higher interest rate and higher degree of safety.
The IIFL Bonds offer highest yield of 10.03% p.a. for tenor of 87 months. The NCD is available in various options like monthly, annual and at maturity. The IIFL Bonds would be issued at face value of Rs 1,000 and the minimum application size is Rs 10,000 across all categories.
In the current scenario, the rate of interest offered by IIFL Finance bonds is very attractive compared with other debt products. Liquid funds offer average net yields of 2.8%-3%, ultra-short-term funds offer average net yields of around 3-3.5%., short-term funds offer average net yield is around 4%-4.25%, while banks are currently offering an interest of around 5.1% for a 3 year fixed deposit.
These 10.03% rate is also getting locked in for 87 months. This is a big advantage as liquidity eases post Covid world for next few years, most experts believe that interest rates can head down and to lock-in good interest rate is a big advantage. Today the interest rates on a 10-year government securities are at 6%. The credit rating has been AA by Crisil and AA+ by Brickwork. Through the crisis, credit rating of IIFL Finance has been reaffirmed by agencies, which indicates that the instruments are considered to have a high degree of safety for timely servicing of financial obligations and carry very low credit risk. Nirmal Jain, Chairman, IIFL Finance said, “IIFL has an impeccable track record of more than 25 years and all the bond issues and the debt obligations have always been paid on time.”
IIFL Finance is one of India’s largest retail-focused financial services companies. IIFL Finance’s Loan Assets under Management is Rs 42,264 crore. Most importantly, 90% of the book is retail - which is focused on small ticket loans.
