Wednesday, October 20

Indiabulls Housing Finance (IBH) raises ₹1,091 crores through foreign currency convertible bonds

The FCCBs, set to mature on March 4, 2026, bear a coupon rate of 4.5%. The bonds are proposed to be listed on Singapore Exchange Securities Trading Ltd.
The FCCBs, set to mature on March 4, 2026, bear a coupon rate of 4.5%. The bonds are proposed to be listed on Singapore Exchange Securities Trading Ltd.

Indiabulls Housing Finance has raised ₹150 million ( ₹1,091 crores) by issuing foreign currency convertible bonds, the company said on Thursday.

The securities issuance committee has approved the allotment of secured Foreign Currency Convertible Bonds (FCCBs) of USD 150 million, convertible into equity share of Rs 2 each, Indiabulls Housing Finance said in a regulatory filing.

The FCCBs, set to mature on March 4, 2026, bear a coupon rate of 4.5%. The bonds are proposed to be listed on Singapore Exchange Securities Trading Ltd.

Indiabulls said as many as 4,49,91,756 equity shares of the company would be in the trade-off with the FCCBs.
This is Indiabulls Housing’s debut convertible bond issuance. Besides, it is also the first FCCB by a financial institution from India in the last 10 years.

Also, read | Indiabulls Housing Finance to raise ₹5,000 crores from securitization in the current quarter

The housing finance firm already raised Rs 2,671 crore by way of a certified institutional placement (QIP) in September 2020, and a partial stake of its funding within the London primarily based OakNorth Bank.

MD and CEO Gagan Banga Stated stated final week in a notice to investors

  • “Thus, amidst challenging global and domestic macro environment, to date in FY2020-21, including the FCCB (assuming full conversion of the FCCBs at the option of the investor).
  • IBH has raised the highest amount of equity capital of nearly Rs 3,750 crore (USD 515 million) amongst our AA-rated NBFC/HFC peers,” The company has strong capital adequacy of 30.5% and a Tier 1 ratio of 23.7%, well above the regulatory requirement.
  • On tapping various sources to raise funds, Banga said convertibles have emerged as an alternative source of capital for Asian corporates, having raised ₹40 billion of capital through convertibles in the last 3 years.
  • With this issuance, Indiabulls Housing Finance has one of the most diversified sources of funding among Indian corporates,” Banga said.
  • We will have scaled up to 5 partners from the present 2 by June 2021 …With our current partners we have already achieved meaningful traction, we are scaling up to achieve Rs 1,500 crores of quarterly disbursals through co-lending by Sep 2021,” Banga Stated.

Major Key Points-

  • The company stated that Macron has strongly tended to the residential housing market in India and this is over an extended period of development.
  • IBH hopes to realize better yields on its retail loans and also to diversify its loan book and customer base.
    It aims to increase the retail customer base by 1.5x by March 2023 and 2x by March 2025.
  • It has targeted retail loans of Rs 1,500 crore a month by September 2021 and a turnover of Rs 2,000 crore per month by March 2022.
  • Shares of Indiabulls Housing Finance closed at Rs 243.40 apiece on BSE, down 1.76 percent from the previous close.

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