Power Finance Corporation Limited to tap Capital Market to raise upto Rs 5,000 crore via public issue of Secured NCD
Power Finance Corporation Limited to tap Capital Market to raise upto Rs 5,000 crore via public issue of Secured NCDs
• Public Issue of secured, rated, listed, redeemable, non-convertible debentures (NCDs) of face value of Rs. 1,000 each
• The Tranche I Issue of NCDs is for a Base Issue Size of Rs. 500 crore with a green shoe option of up to Rs. 4,500 crore aggregating up to Rs. 5,000 crore, which is within the shelf limit of Rs. 10,000 crore
• NCDs are rated as CARE AAA/Stable by CARE Ratings Limited, CRISIL AAA/Stable by CRISIL Limited and [ICRA AAA] (Stable) by ICRA Limited
• Coupon Rate up to 7.55% p.a. #
• Tranche I NCD Issue opens on July 21, 2023, and closes on July 28, 2023 with an option of early closure or extension
• The NCDs are proposed to be listed on BSE Limited (“BSE”) (“Stock Exchange). BSE is the designated stock exchange for the Tranche I Issue
# Applicable for NCDs (for Category III & IV Investors) series III with the tenor of 15 years, for further details please refer to chapter titled ‘Issue Structure’ on page 70 of the Tranche I Prospectus dated July 17, 2023.
New Delhi, July 19, 2023: 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.
About Power Finance Corporation Limited:
Power Finance Corporation is a publicly listed Government of India (GoI) undertaking and operates as a public financial institution as defined under the Companies Act of 2013. Registered with the Reserve Bank of India (RBI) as a non-deposit taking systemically important Non-Banking Financial Company (NBFC), it obtained the classification of an Infrastructure Finance Company (IFC) on July 28, 2010. The Company believes that its NBFC and IFC classifications enables it to effectively capitalize on available financing opportunities in the Indian power sector.
DISCLAIMER: Power Finance Corporation Limited (“Company”), subject to market conditions and other considerations is proposing a public issue of secured, rated, listed, redeemable non-convertible debentures of face value of ₹ 1,000 each (“NCDs”) and has filed the Shelf Prospectus dated July 17, 2023, (the “Shelf Prospectus”) and Tranche I Prospectus dated July 17, 2023 (“Tranche I Prospectus”, and together with Shelf Prospectus, “Prospectus”) with the Registrar of Companies, Delhi and Haryana, BSE Limited (“BSE”) and Securities and Exchange Board of India (“SEBI”). The Prospectus is available on the Company’s website at www.pfcindia.com; on the BSE’s website at www.bseindia.com, on the website of SEBI at www.sebi.gov.in and the respective websites of the lead managers at www.jmfl.com, www.akgroup.co.in, www.nuvama.com, www.smccapitals.com and www.trustgroup.in. Investors proposing to participate in the Tranche I Issue, should invest only on the basis of the information contained in the Prospectus. Investors should note that investment in this public issue of NCDs involves a high degree of risk and for details relating to the same, please refer to Tranche I Prospectus and the section on “Risk Factors” beginning on page 19 of the Shelf Prospectus.
Capitalised terms not defined herein shall have the same meaning as assigned to such terms in the Prospectus.
DISCLAIMER: Investors proposing to participate in the Tranche I Issue should note that investment in the NCDs involves a high degree of risk and for details in relation to the same, refer to the Tranche I Prospectus dated July 17, 2023 (“Tranche I Prospectus”) read together with the Shelf Prospectus dated July 17, 2023 (“Shelf Prospectus”) (collectively referred to as “Prospectus”) including the sections titled “Risk Factors” beginning on page 19 of the Shelf Prospectus and “Material Developments” beginning on 48 of the Tranche I Prospectus. The Issuer and the Lead Managers accept no responsibility for statements made otherwise than in the Prospectus or in the advertisement or any other material issued by or at the instance of the Company and that anyone placing reliance on any other source of information would be doing so at their own risk.
DISCLAIMER CLAUSE OF BSE: It is to be distinctly understood that the permission given by BSE should not in any way be deemed or construed that the Offer Document has been cleared or approved by BSE nor does it certify the correctness or completeness of any of the contents of the Offer Document. The investors are advised to refer to the Prospectus for the full text of the “Disclaimer Clause of BSE.”
DISCLAIMER CLAUSE OF USE OF BSE ELECTRONIC PLATFORM: It is to be distinctly understood that the permission given by the BSE to use their network and software of the Online system should not in any way be deemed or construed as compliance with various statutory requirement approved by the Exchange; nor does it any manner warrant, certify or endorse the correctness or completeness of any of the compliance with the statutory and other requirements; nor does it take any responsibility for the financial or other soundness of the Company, its promoters, its management or any scheme or project of this Company. It is also to be distinctly understood that the approval given by the Exchange is only to use the software for participating in system of making application process.
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