Chennai : Power Finance Corporation, is one of India’s leading public financial institution and a Schedule-A Maharatna Central Public Sector Enterprises (CPSE), focused on the power sector, has filed tranche I prospectus dated July 17, 2023 (“Tranche I Prospectus”) for public issue of secured, rated, listed, redeemable, non-convertible debentures of the face value of Rs. 1,000 each. The base issue size is Rs. 500 crore with a green shoe option of up to Rs. 4,500 crore, aggregating up to Rs. 5,000 crore (“Tranche I Issue”), which is within the shelf limit of Rs. 10,000 crore (“Issue”).
The Tranche I Issue opens on Friday, July 21, 2023, and closes on Friday, July 28, 2023 with an option of early closure or extension in compliance with Securities and Exchange Board of India Issue and listing of (Non-Convertible Securities) Regulations 2021, as amended (“SEBI NCS Regulations”). The NCDs are proposed to be listed on BSE Limited (“BSE”), with BSE being the Designated Stock Exchange for the Issue. The NCDs have been rated by CARE AAA/Stable by CARE Ratings Limited, CRISIL AAA/Stable by CRISIL Limited and ICRA AAA (Stable) by ICRA Limited.
The minimum application size would be Rs. 10,000 (i.e. 10 NCDs) and thereafter in multiples of Rs. 1,000 (i.e. 1 NCD) thereof. This issue has maturity / tenure options of 3 years, 10 years and 15 years for NCDs with annual coupon payment being offered across series I, II, and III, respectively. Effective yield for NCD holders in various categories ranges from 7.44% to 7.54% per annum.
Out of the net proceeds of the Tranche I Issue, at least 75% shall be utilised for the purpose of onward lending, financing / refinancing the existing indebtedness of the company, and /or debt servicing (payment of interest and/or repayment / prepayment of interest and principal of existing borrowings of the Company) and a maximum up to 25% will be utilised for general corporate purposes.
For the fiscal year 2023, the company’s consolidated revenue from operations stood at Rs 77,568.30 crore against Rs 76,261.66 crore a year ago on the back on increase in interest income on loans and other operating income. Consolidated Net profit for the FY23 was Rs 21,178.59 crore as against Rs 18,768.21 crore last year.
The terms of each series of Secured NCDs, offered under Tranche I Issue are set out below:
| Series |
I |
II* |
III |
| Frequency of Interest Payment |
Annual |
Annual |
Annual |
| Minimum Application |
₹10,000 (10 NCDs) across all series |
||
| In Multiples of thereafter (₹) |
₹1,000 (1 NCD) |
||
| Face Value / Issue Price of NCDs (₹/NCD) |
₹1,000 |
||
| Tenor |
3 Years |
10 Years |
15 Years |
| Coupon (% per annum) for NCD Holders in Category I and Category II |
7.45% |
7.47% |
7.50% |
| Coupon (% per annum) for NCD Holders in Category III and Category IV |
7.50% |
7.53% |
7.55% |
| Effective Yield (% per annum) for NCD Holders of Category I
and Category II |
7.44% |
7.46% |
7.49% |
| Effective Yield (% per annum) for NCD Holders of Category III
and Category IV |
7.49% |
7.52% |
7.54% |
| Mode of Interest Payment |
Through Various Modes available |
||
| Amount (₹ / NCD) on Maturity for NCD Holders in Category
I, Category II, Category III & Category IV |
₹1,000 |
₹1,000 |
₹1,000 |
| Maturity / Redemption Date (from the Deemed Date of
Allotment) |
3 Years |
10 Years |
15 Years |
| Nature of Indebtedness |
Secured |
||
| Put and Call option |
Not Applicable |
||
*The Company shall allocate and allot Series II NCDs wherein the Applicants have not indicated the choice of the relevant NCD Series.
JM Financial Limited, A.K.Capital Services Limited, Nuvama Wealth Management Limited, SMC Capitals Limited, and Trust Investment Advisors Private Limited are the lead managers to the Issue (“Lead Managers”). Beacon Trusteeship Limited is the Debenture Trustee to the Issue and KFin Technologies Limited is the Registrar to the Issue.
Please note that the allotment under Tranche I Issue will be on the basis of the date of upload of each application into the electronic book of the Stock Exchange in accordance with the SEBI Master Circular. However, from the date of oversubscription and thereafter, the allotments will be made to the applicants on a proportionate basis. For further details, refer section titled “Issue Procedure” on page 98 of the Tranche I Prospectus dated July 17, 2023.
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