Public Issue of Secured and Unsecured Redeemable Non- Convertible Debentures of Rs. 100 Cr. with an option to retain over subscription upto Rs. 100 Cr aggregating to Rs. 200 Cr. by Kosamattam Finance Limited (CREDIT RATING: CARE ‘BB+’ [Double B Plus] by CARE.
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[wptabtitle] Product Note[/wptabtitle] [wptabcontent]
Kosamattam Finance Limited NCD Issue Highlights
| Issuer | Kosamattam Finance Limited |
| Type of Instrument | Secured and Unsecured, Redeemable Non-Convertible Debentures |
| Issue Open | 29th August, 2016 |
| Issue Close | 27th Sep., 2016* |
| Issue Size | Base Issue size of Rs. 10,000 Lacs, with an option to retain over subscription of Rs.10,000 Lacs, aggregating to a total of Rs. 20,000 Lacs The Company shall ensure that Secured NCDs shall be allotted for a value upto Rs.20,000lacs and Unsecured NCDs shall be allotted for a value upto Rs. 1,000 lacs, subject to the total issue size not exceeding Rs.20,000 lacs |
| Face Value | Rs. 1,000 |
| Min. Application Size | Rs. 10,000/- or 10 NCDs (for all Series of NCDs either taken individually or collectively) |
| Interest | Annually & Cumulative |
| Mode of Allotment | In Dematerialized form and Physical form, at the option of the Applicant |
| Rating | CARE BB+ [CARE Double B Plus] |
| Listing | BSE Limited |
Specific Term of Issue
Kosamattam Finance Ltd NCD Interest Rate for Secured Option (Option VII & VIII unsecured Category)
| Option | I | II | III | IV | V | VI |
| Tenure | 400 Days | 18 Month | 18 Month | 36 Month | 36 Month | 48 Month |
| Interest Payment Frequency | Cumulative | Monthly | Cumulative | Month | Cumulative | Cumulative |
| Coupon | NA | 9.75% | NA | 10.75% | NA | NA |
| Effective Yield | 9.25% | 10.20% | 9.77% | 11.30% | 10.75% | 10.67% |
| Maturity Amount | 1101.81 | 1000 | 1150 | 1000 | 1358.41 | 1500 |
Cheque Details :
Cheque / DD should be drawn in favour of “—————- “ by all applicant
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[wptabtitle] About Issue[/wptabtitle] [wptabcontent]
About Company
- Kosamattam Finance Ltd. (KFL/ Company), headquartered in the southern Indian state of Kerala, is registered with RBI as a non-deposit taking, systematically important, NBFC, lending money against pledge of used household gold jewellery (“Gold Loans”) in the state of Kerala, Tamil Nadu, Karnataka, Andhra Pradesh, Delhi,Maharashtra,Gujarat,Telangana and in the Union Territory of Puducherry.
- The Kosamattam Group was originally founded by Mr. Chacko Varkey (also known as Mr. Nasrani Varkey). His great grandson, Mr. Mathew K. Cherian, the present Chairman and Managing Director of Kosamattam Group is a fourth generation entrepreneur in the family.
- As on December 31, 2014, Kosamattam Finance Ltd is having a branch network of 875 branches, largely spread across Southern India. The Gold Loan portfolio of KFL as of November 30, 2014 is comprised of 4,32,530 gold loan accounts, aggregating Rs.1,10,160.97 lacs which is 95.85 % of total loans portfolio.
- Gross non-performing gold loan assets were 0.91%, 0.17%, 0.31% and 0.36% of portfolio under management as of November 30, 2014, March 31, 2014, 2013 and 2012 respectively.
- As of November 30, 2014, the average loan amount advanced by KFL was Rs. 25,469 per loan transaction. All of the Gold Loans have a term of 12 months with an option to early closure. In the financial period ended November 30,2014, the yield on Gold Loan assets was 20.55%.
- In addition to the core business of Gold Loan, KFL also offers fee based ancillary services which includes money transfer services, foreign currency exchange and air ticketing services.
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[wptabtitle] Apply[/wptabtitle] [wptabcontent]
WHO CAN APPLY – Kosamattam Finance Ltd NCD Issue
Category:1
- Resident Public Financial Institutions as defined in Section 2(72) of the Companies Act 2013, Statutory Corporations including State Industrial Development Corporations, Scheduled Commercial Banks
- Co-operative Banks and Regional Rural Banks, which are authorized to invest in the NCDs
- Provident Funds of minimum corpus of Rs. 2,500 Lacs , Pension Funds of minimum corpus of Rs. 2500 Lacs,Superannuation Funds and Gratuity Fund,which are authorized to invest in the NCDs
- Venture Capital funds and/ or Alternative Investment Funds registered with SEBI
- Insurance Companies registered with the IRDA
- National Investment Fund (set up by resolution no. F. No. 2/3/2005-DDII dated November 23, 2005 of the Government of India and published in the Gazette of India)
- Insurance funds set up and managed by the Indian army, navy or the air force of the Union of India or by the Departmentof Posts, India
- Mutual Funds, registered with SEBI
Category:2
- Companies falling within the meaning of Section 2(20) of the Companies Act 2013; bodies corporate and societies registered under the applicable laws in India and authorized to invest in the NCDs
- Educational institutions and associations of persons and/or bodies established pursuant to or registered under any central or state statutory enactment; which are authorized to invest in the NCDs
- Trust including Public/private charitable/religious trusts which are authorized to invest in the NCDs
- Association of Persons
- Scientific and/or industrial research organisations, which are authorized to invest in the NCDs
- Partnership firms in the name of the partners
- Limited liability partnerships formed and registered under the provisions of the Limited Liability Partnership Act,2008 (No. 6 of 2009)
Category:3
- Resident Indian individuals and Hindu undivided families through the Karta aggregating to a value exceeding Rs. 5 Lacs
- Resident Indian individuals
- Hindu undivided families throughthe Karta(Applications aggregating to a value not more than Rs. 5 Lacs
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[wptabtitle] Objects[/wptabtitle] [wptabcontent]
OBJECTS OF THE ISSUE
The Company is in the business of gold loan financing, and as part of its business operations, it raises/avails funds for onward lending and for repayment of interest and principal of existing loans.
The following table details the objects of the Issue and the amount proposed to be financed from the Net Proceeds:
| Sr.No | Objects of the Fresh Issue | Percentage of amount proposed to be financed from Issue Proceeds |
| 1 | Onward lending and for repayment of interest and principal of existing loans | atleast 75% |
| 2 | General Corporate Purposes* | upto 25% |
| Total | 100% |
*The Net Proceeds will be first utilized towards the Objects mentioned above. The balance is proposed to be utilized for general corporate purposes, subject to such utilization not exceeding 25% of the amount raised in the Issue, in compliance with the Debt Regulations.
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[wptabtitle] STRENGTHS & STRATEGIES [/wptabtitle]
COMPETITIVE STRENGTHS & KEY STRATEGIES: Kosamattam Finance Ltd
Strengths:
- Part of the Kosamattam Group which has a long operating history and a large customer base.
- Branch network across rural and semi-urban areas in South India.
- Organized and efficient IT Infrastructure
- Effective risk management system including appraisal, internal audit and inspections.
- Experienced management team and skilled personnel
Strategies:
- Expansion of business by opening new branches in rural and semi urban areas to tap potential market for gold loans
- Expansion of business into metros and select Tier 1 cities across India
- Increase visibility of Kosamattam Brand to attract new customers
- Diversifying into new business initiatives by leveraging branch network and customer base.
- Minimize concentration risk by diversifying the Product Portfolio and expanding customer base
- Further strengthening risk management, loan appraisal and technology systems
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[wptabtitle] Listing [/wptabtitle]
NCD Kosamattam Finance Ltd Issue Open 29 Aug 2016 Issue Close 27 Sep 2016 Issue Registrar Karvy Computershare Listing Exchange BSE / NSE Allotment Date 29 Sep 2016 Listing Date 5 Oct 2016 Interest Payment Date Face Value 1000 Circular Ref. No BSE- 20161004-24
| Series | I | II | III | IV | V | VI | VII | VIII |
|---|---|---|---|---|---|---|---|---|
| Coupon | N.A. | 9.75% | N.A. | 10.75% | N.A. | N.A. | 11.00% | N.A. |
| Effective Yield | 9.25% | 10.20% | 9.77% | 11.30% | 10.75% | 10.67% | 11.57% | 11.25% |
| ISIN No | INE 403Q07490 | INE 403Q07508 | INE 403Q07516 | INE 403Q07524 | INE 403Q07532 | INE 403Q07540 | INE 403Q08068 | INE 403Q08076 |
| BSE Code | 935872 | 935874 | 935876 | 935878 | 935880 | 935882 | 935884 | 935886 |
| Maturity | 03-11-2017 | 28-03-2018 | 28-03-2018 | 28-09-2019 | 28-09-2019 | 28-09-2020 | 28-03-2023 | 28-03-2023 |
| Maturity Amt | 1101.81 | 1000 | 1150 | 1000 | 1358.41 | 1500 | 1000 | 2000 |
| Security Desc. | Secured | Secured | Secured | Secured | Secured | Secured | UnSecured | UnSecured |
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