Submission of Outcome of Board Meeting.
Price
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The Board of Directors of Regency Fincorp Limited approved the issuance of 30,000 units of Secured, Rated, Listed Non-Convertible Debentures (NCDs) worth INR 30 crores on a private placement basis. Each NCD has a face value of INR 10,000 and will be listed on BSE Limited. The debentures carry an interest rate of 14% per annum, payable monthly, with quarterly principal repayment over a tenure of 12 months and 5 days. The company has created a security charge of 1.25x over its receivables to protect debenture holders. Catalyst Trusteeship Limited was appointed as Trustee and Credora Partners Private Limited as Merchant Banker for this issuance.
This debt issuance provides the company with INR 30 crores of capital for operations, but the relatively high 14% interest rate indicates significant borrowing costs. Existing shareholders should monitor the company's ability to service this debt given the quarterly principal repayment schedule.