10.2% Muthoottu Mini Financiers NCD – Dec 2021 – Review

Muthoottu Mini Financiers NCD -Dec-2021 issue detailsMuthoottu Mini Financiers NCD Dec 2021 – Issue details, Interest Rates and Review

Muthoottu Mini Financiers is coming up with secured NCD bonds now. These NCD bonds would open for subscription on 1st December, 2021. Muthoottu Mini Financiers is a leading NBFC company in India which is focused on providing loans against household gold jewelry. The interest rates for Muthoottu Mini Financiers NCD are up to 9.75% and yield is up to 10.2%. These NCDs are offered for 480 days to 66 months tenure. These interests are paid either monthly or on maturity. Should you invest in Muthoottu Mini Financiers NCD 2021? What are the risk factors in these NCD? In this article we would provide Muthoottu Mini Financiers Ltd NCD Review.

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About Muthoottu Mini Financiers Limited

They are a non-deposit taking systemically important NBFC in the gold loan sector lending money against the pledge of household gold jewelry in the state of Kerala, Tamil Nadu, Karnataka, Andhra Pradesh, Telangana, Haryana, Maharashtra, Delhi and Goa and the union territory of Puducherry.

Muthoottu Mini Financiers NCD – December 2021 Issue Details

These NCDs would open for subscription on 1st December, 2021 and closes on 28th December, 2021.

These NCD’s are available in 6 different options. The tenure for these NCDs are 480 days, 24 months, 36 months, 48 months and 66 months.

Coupon interest rates are between 8.5% to 9.75%.  Yield on these NCD bonds works out up to 10.2% which is higher.

It issues secured NCDs which are somewhat safe investment options.

Interest is payable monthly or on maturity depending on the option chosen by the NCD investor.

The face value of the NCD bond is Rs 1000.

Minimum investment is for the 10 bonds. Means, you need to invest for a minimum of Rs 10,000. Beyond this you can invest in multiples of 1 bond.

These NCD bonds would be listed on BSE within 6 working days from the issue closure date. Hence, these are somewhat liquid investments.

These are allotted on first come first serve basis. Hence the issue can be closed before this date if it is oversubscribed before the closure date.

NRI’s cannot apply to this NCD subscription.

The base issue size is Rs 100 Crores with an option to retain over subscription up to Rs 100 Crores totaling to Rs 200 Crores.

Vivro Financial Services Pvt Limited is the lead manager for this NCD issue.

Muthoottu Mini Financiers December 2021 NCD Prospectus

Muthoottu Mini NCD Interest Rates – Dec-21 issue

Muthoottu Mini Financiers NCD Interest Rates – Dec-21 issue

What are Muthoottu Mini NCD 2021 Rating?

These NCDs have been rated as CARE BBB+: Stable by CARE which indicate that instruments with this rating are considered to have a moderate degree of safety regarding timely servicing of financial obligations and carry a moderate credit risk

How is the company doing in terms of profits?

Here are the details of the profits of the company.

Year ending Mar-2020 – Rs 33.5 Crores

Year ending Mar-2021 – Rs 31.9 Crores

Why to invest in these NCDs?

1) Muthoottu Mini NCD interest rates are attractive where investors can get interest up to 9.75% per annum and yield up to 10.2%.

2) Muthoottu Mini Financiers generates consistent margins. This means that company has ability to pay interest payment on time to its NCD holders without any delay.

3) It issues secured NCDs. These NCDs are safe compared to unsecured NCDs. In case company gets into financial crisis and wind-up/shut down, secured NCD investors would get preference in repayment of capital along with interest as those backed up by assets of the company. Hence it is safe to invest in such secured NCD options.

Why not to invest in these NCDs?

1) The company has a credit rating of BBB+ from CARE Ratings. Bonds that have a credit rating below A are considered as very high risk.

2) The impact of Covid-19 pandemic on its business is uncertain and cannot be predicted.

3) Refer prospectus for complete risk factors.

How to subscribe to these NCDs?

This issue is available in only in demat form. You can apply online or through any of the broker website where you are maintaining a demat account. Application forms can be downloaded on the lead manager web site. For more information on this you can refer prospectus.

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Should you invest in Muthoottu Mini Financiers NCD 2021?

Muthoottu Mini Financiers NCD offers high interest rates. Banks are offering low interest rates, hence investors would get tempted with such high interest rate NCDs. Muthoottu Mini NCD 2021 rating is BBB+: Stable by CARE Ratings which are low. Such credit ratings may further fall in future. One should always invest in A rated NCDs. It issues secured NCDs which are safe compared to other unsecured NCDs. High risk investors can invest in these secured NCDs. Moderate to low risk investors should avoid such NCDs.

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Suresh KP

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