To be followed by HK, London presentations on Nov 29 and Dec 2
KOCHI: Manappuram Finance will kick-start its investor road-shows on Thursday, November 28, 2019 from Singapore in connection with the overseas borrowing under the $750 million euro medium term note (EMTN) programme established by the company as part of its external commercial borrowings (ECB) initiative.
The international rating agency, Standard & Poor’s (S&P) has assigned the company an Issuer Rating of BB- long-term and B short-term with stable outlook in connection with the issue of dollar denominated debt instruments by the company soon.
In fact, the S&P ratings are inevitably of speculative and default grades. “However, these are decent international ratings that can be expected for a company like Manappuram given the fact that India itself currently enjoys an S&P sovereign rating of BBB-, which is considered to be the lowest investment grade rating,” an investment expert explained.
The Singapore road-show will be followed by another one in Hong Kong on November 29, and the third road-show, according to the company, will be staged in London on December 2.
Manappuram Finance MD and CEO, VP Nandakumar, had earlier informed that the first tranche would aim to raise $300 million and the rest of the $750 million could be raised in different tranches in the future depending on the market conditions and the company requirements.
It was at a meeting on November 6, 2019, the board of directors of the company had given the approval for $750 million EMTN programme.
“The pricing, tenure and other terms of the bonds to be issued pursuant to the issue will be determined by the Financial Resources and Management Committee to be likely held on December 3, 2019, once the overseas road-shows are concluded,” the company said in a statement sent to the stock exchanges.
Importantly, Manappuram Finance has raised $75 million (Rs5.3billion) dollar-based debt facility from International Finance Corporation (IFC) and another one for a value of $110 million (Rs7.7billion) from Nabard during the course of the current year.
Muthoot Finance, the largest gold loan company by far has also raised overseas borrowing to the tune of $450 million recently as part of an ambitious $2 billion programme the company has announced recently.
According to a Manappuram research, while Muthoot Finance controls 47 per cent of the $10.2 billion (Rs72,000 crore) gold loan market during FY2019, Manappuram boasts only 18 per cent, the remaining being distributed among other players with Muthoot Fincorp alone claiming 15 per cent of the total market.