Intimation under Regulation 30 of SEBI (LODR) Regulations, 2015 for Allotment of 500 14% Secured, Unrated, Unlisted Non-Convertible Debentures
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The company has allotted 500 Non-Convertible Debentures (NCDs) of face value Rs. 1,00,000 each, raising a total of Rs. 5 crore. The NCDs carry a 14% per annum coupon rate with interest payable monthly, have a tenure of 36 months (3 years), and are secured against receivables with a 1.10x cover plus a personal guarantee. The debentures are unlisted and unrated, meaning they won't trade on any stock exchange and haven't been assessed by a credit rating agency. The Capital Raising Committee approved the allotment at its meeting on 11th June 2025.
The 14% interest rate is notably high, suggesting either a sub-optimal credit profile or limited access to cheaper funding sources, which will increase the company's debt servicing costs over the next 3 years. For existing shareholders, this means higher finance costs eating into future profits, though the small Rs. 5 crore size limits the overall impact.