Fedfina (Fedbank Financial Services), India’s non-banking financial services companies, forayed into the Indian bond market last week.
Initially, the aim was to raise ₹100 crore through debentures, with a Greenshoe option to retain oversubscription up to ₹100 crore. Fedfina successfully raised a large issue amount of ₹187.5 crore. The coupon rate for the issuance was set to be at 9% p.a. for a tenure of three years. The debentures have largely been picked up by banks and other financial institutions.
Anil Kothuri, MD and CEO, Fedfina said, “This is Fedfina’s maiden issuance of Non-Convertible Debentures. It is reassuring to see our investors show such immense faith, especially in such a turbulent market. It is a testimony to Fedfina’s pedigree and a show of faith in our plans for the future.” He further added, “The current environment, due to Covid-19 has shown a large demand for gold loans. The proceeds of this issue will be deployed to cater to this increased demand. We are in the midst of expanding our gold loan business and our branch network.”
In early 2019, Fedfina had announced a comprehensive 5-year expansion plan to strengthen its network to 500 branches and thereby scale up the business operations in different geographies of the country.