Indel Money NCD opens on 27th May, 2022 – Should you invest?

Indel Money NCD issue opens on 27th May, 2022. Check issue details and interest ratesIndel Money is coming up with secured NCD’s that would open for subscription on 27th May 2022. Indel Money is a non-deposit taking systematically important NBFC in India. In this NCD issue, it offers up to 11% interest rates and yield up to 11.57%. These NCDs are offered for 366 days to 77 month tenure. Interest is paid either monthly or on maturity. Should you invest in Indel Money NCD May 2022 issue? What are the risk factors in such NCDs?

Also Read: Muthoot Finance NCDs open on 25th May, 2022

About Indel Money Limited

Company is a non-deposit taking and a systemically important non-banking finance company. It is in the gold loan sector lending money against the pledge of household gold jewelry in the states of Kerala, Tamil Nadu, Karnataka, Andhra Pradesh, Odisha and Telangana and the union territory of Puducherry.

Indel Money NCD Issue Details – May-2022

NCD Subscription opens on 27-May-2022 on closes on 22-June-2022.

These NCDs are issued on a first come, first serve basis, hence the issue can close before the closure date if it is oversubscribed.

NCD’s are issued in 8 different options. These NCD’s are issued for 366 days, 18 months, 24 months, 61 months and 77 months tenure.

Coupon interest rates are between 9% to 11%. Yield on these NCD bonds works out up to 11.57% (highest).

It offers secure NCD, which is safe to invest.

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.

NRI’s cannot apply to this NCD subscription.

The base issue size for May 2022 NCD issue is Rs 50 Crores with an option to retain over subscription up to Rs 50 Crores totaling to Rs 100 Crores.

Vivro Financial Services is the lead manager for the issue.

Indel Money NCD May 2022 Prospectus

Indel Money NCD Interest rates

What are the credit ratings for these NCDs?

These NCDs have been rated as BBB+/Stable by Acuite Ratings & Research which indicates that instruments with this rating are considered to have a moderate degree of safety regarding timely servicing of financial obligations. Such instruments carry moderate credit risk.

How is the company doing in terms of profits?

Here are the details of profits of the company.

Year ending Mar-2019 – Rs 1.56 Crores

Year ending Mar-2020 – Rs 2.19 Crores

Year ending Mar-2021 – Rs 9.49 Crores

Why to invest in Indel Money NCD’s?

These NCDs come with attractive interest rates up to 11%.

Company is generating good profits, hence in future there might not be delay in interest payments.

These bonds are secured in nature, hence these are less risky compared to unsecured NCDs.

Why not to invest in Indel Money NCD?

Company business has affected with covid-19 pandemic and this uncertainty might continue in future too.

Company business is capital intensive. Any disruption or restriction in raising financial resources would have a material adverse effect.

Volatility in the market price of gold may adversely affect company financial condition and results of operations.

Refer prospectus for complete risk factors.

How to apply Indel Money NCD bonds?

This issue is available in demat form only. You can login to your demat account and apply during the subscription period.

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Indel Money NCD – Should you Invest?

Indel Money NCD’s have high interest rates up to 11%. Currently banks or financial institutions are offering low interest rates on the FDs, hence these look attractive. These NCDs are rated as BBB+/Stable which are considered as low rating. Such credit ratings can change in the future. Investors should understand all these pros and cons indicated above before investing in such high risk NCD investments.

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Suresh KP

3 comments

  • Anuj Gupta

    Sir, I want to invest 50K in NCD…could you please help me choose one of them

    Navi Finserv NCD issue May-2022 – Series 1 – 18 months – 9.20% (Monthly Payout)
    or
    Indel Money NCD May 2022 – Series 3 or 5 – 18/24 months – 9.50% / 10.55% (Monthly Payout)

    • There is no readymade answer. It depends on how well you understood the risks in both these NCDs + Credit Rating of these NCDs. If someone asks me to choose between these two, I would prefer Navi Finserv NCD as these are A rated bonds compared to Indel Money NCDs which are BBB rated bonds. However, there is no guarantee that in future these ratings would sustain.

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