NORTHARCNSENorthern Arc Capital LimitedHighNeutral
Announced Mon, 19 May · 20:54 IST

Northern Arc Capital Limited has informed the Exchange about the approval of Board accorded for Issuance of Non-Convertible Debenture for an amount not exceeding Rs. 5,000 crores, on private placement basis

Fund Raising View source PDF

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Price reaction · full curve

Awaiting price reaction for this filing.

AI summary

Northern Arc Capital's board, at its May 19, 2025 meeting, approved issuance of Non-Convertible Debentures (NCDs) up to Rs. 5,000 crores on a private placement basis, subject to shareholder approval. The board also approved audited Q4 and FY25 results (standalone and consolidated) with an unmodified opinion from auditors Walker Chandiok & Co LLP. For FY25, standalone total income from operations rose to Rs. 2,28,411 lakhs from Rs. 1,82,856 lakhs in FY24, while net profit after tax grew to Rs. 34,261 lakhs from Rs. 28,017 lakhs. Basic EPS for FY25 stood at Rs. 22.59. The company also appointed M/s. Alagar & Associates as Secretarial Auditors for five years from FY26 to FY30. Notably, auditors flagged an RBI directive dated May 16, 2025 requiring the company to exclude First Loss Default Guarantee (FLDG) credit enhancements from its Expected Credit Loss computation by June 30, 2025, which could lead to additional ECL provisions. CRAR remains healthy at 24.72%, with Gross Stage 3 assets at 0.99%.

Likely market impact

The Rs. 5,000 crore NCD fundraising will boost capital available for the NBFC's lending operations, supporting business growth. However, the RBI direction on FLDG-based credit enhancements may require additional provisioning in Q1FY26, which is a near-term earnings watchpoint. Existing shareholders should track the ECL impact and utilization of fresh NCD proceeds.