IIFL Finance Limited has come up with its Tranche I – February 2026 NCD issue offering interest rates up to 9.00% per annum. In the current market where bank fixed deposits are offering relatively moderate returns, many investors are evaluating secured NCDs for slightly higher yields. This public issue of secured, redeemable, non-convertible debentures (NCDs) comes with AA category credit ratings and multiple tenure options ranging from 24 months to 60 months. The issue size aggregates up to ₹2,000 Crores including green shoe option. In this detailed review, we will cover company background, NCD issue details, interest rates, credit ratings trend, financial performance, risks, and finally whether you should invest or avoid this issue.
IIFL Finance NCD February 2026 – Issue Details
Here are the complete issue details in the structured format similar to our earlier NCD reviews:
Issue Snapshot
| Particulars | Details |
|---|---|
| Security Name | IIFL Finance Limited |
| Issue Type | Secured, Redeemable, Non-Convertible Debentures |
| Tranche | Tranche I – February 2026 |
| Issue Opens | February 17, 2026 |
| Issue Closes | March 4, 2026 |
| Base Issue Size | ₹500 Crores |
| Green Shoe Option | ₹1,500 Crores |
| Total Issue Size | ₹2,000 Crores |
| Face Value | ₹1,000 per NCD |
| Issue Price | ₹1,000 |
| Minimum Application | 10 NCDs (₹10,000) |
| Market Lot | 1 NCD |
| Listing | NSE & BSE |
| Allotment | First Come First Serve (FCFS) |
| Credit Ratings | CRISIL AA/Stable, Brickwork AA+/Stable |
| Debenture Trustee | Vardhman Trusteeship Pvt. Ltd. |
The NCDs are secured and backed by receivables of the company with at least 100% security cover maintained at all times.
Interest Rates, Tenure and Series Details
The company has offered 9 series under Monthly, Annual and Cumulative options as given below:
| Series | Interest Payment | Tenure | Coupon (% p.a.) | Effective Yield (% p.a.) | Maturity Amount (₹) |
|---|---|---|---|---|---|
| I | Monthly | 24 Months | 8.37% | 8.70% | 1,000 |
| II | Monthly | 36 Months | 8.52% | 8.85% | 1,000 |
| III | Monthly | 60 Months | 8.65% | 9.00% | 1,000 |
| IV | Annual | 24 Months | 8.70% | 8.69% | 1,000 |
| V | Annual | 36 Months | 8.85% | 8.84% | 1,000 |
| VI | Annual | 60 Months | 9.00% | 8.99% | 1,000 |
| VII | Cumulative | 24 Months | NA | 8.70% | 1,181 |
| VIII | Cumulative | 36 Months | NA | 8.85% | 1,290 |
| IX | Cumulative | 60 Months | NA | 9.00% | 1,539 |
Maximum interest offered is 9.00% under the 60-month annual and cumulative options. Compared to its previous issue, coupon rates are marginally lower reflecting current interest rate trends.
The issue offers multiple series with monthly, annual and cumulative options.
Monthly Interest Options:
• 24 months – 8.37% (Effective yield 8.70%)
• 36 months – 8.52% (Effective yield 8.85%)
• 60 months – 8.65% (Effective yield 9.00%)
Annual Interest Options:
• 24 months – 8.70%
• 36 months – 8.85%
• 60 months – 9.00%
Cumulative Options:
• 24 months – Maturity ₹1,181
• 36 months – Maturity ₹1,290
• 60 months – Maturity ₹1,539
The highest coupon offered is 9.00% for 60-month annual interest option.
Compared to its previous NCD issue in 2025, the coupon rates are slightly lower, reflecting changing interest rate conditions.
Credit Ratings
The NCDs are rated:
• CRISIL AA/Stable
• Brickwork AA+/Stable
AA rating indicates high degree of safety and very low credit risk. However, investors should note that AA is not AAA. There is still moderate credit risk compared to top-tier government-backed instruments.
Credit Rating Trend in Last Few Years
Over the past 3–5 years, IIFL Finance has largely maintained ratings in AA category. There have been outlook revisions during volatile periods in NBFC space, but the company continues to hold strong credit profile supported by:
• Diversified loan book
• Strong capital adequacy
• Secured lending exposure
• Established brand presence
However, NBFC sector remains sensitive to liquidity cycles and regulatory changes.
Objects of the Issue
The company intends to utilize the proceeds for:
• Onward lending and financing
• Repayment/prepayment of borrowings
• General corporate purposes
This is standard usage for NBFC NCD issues.
Company Financials (₹ Crores)
Assets:
• FY22: 45,910
• FY23: 53,001
• FY24: 62,421
• Sep 2024: 55,372
Revenue:
• FY22: 7,006
• FY23: 8,447
• FY24: 10,490
• Sep 2024: 5,201
Profit After Tax:
• FY22: 1,188
• FY23: 1,607
• FY24: 1,974
• Sep 2024: 245
Net Worth has steadily increased from ₹6,273 Cr in FY22 to ₹11,867 Cr as of Sep 2024.
While FY24 showed strong profitability, recent performance needs monitoring due to sector-wide stress in NBFCs and regulatory actions seen in some lending segments.
Why to Invest in IIFL Finance NCD?
• Attractive interest up to 9% compared to bank FDs
• Secured NCDs with 100% security cover
• Established NBFC with diversified portfolio
• AA category credit rating
• Multiple interest payout options
• Listed on NSE & BSE providing liquidity
Suitable for investors looking for medium-term fixed income with slightly higher returns than traditional deposits.
Why Not to Invest?
• Not AAA rated
• NBFC sector carries liquidity and regulatory risks
• Credit risk higher than PSU or government-backed bonds
• Interest income is taxable as per slab
• Market liquidity for NCDs can be limited
Investors with very low risk appetite may prefer AAA rated bonds or bank deposits.
How to Apply?
You can apply through:
• Net banking ASBA
• UPI (for retail investors)
• Through brokers
• Through demat account platforms
Minimum investment is ₹10,000. Ensure you apply early as allotment is on First Come First Serve basis.
Should You Invest or Avoid?
IIFL Finance NCD February 2026 issue offers decent yields in the 8.37%–9.00% range with AA category ratings. For investors who understand NBFC risks and are comfortable with moderate credit risk, this can be considered as part of a diversified debt portfolio.
However, conservative investors who prefer highest safety may consider AAA rated PSU bonds instead.
Avoid allocating large portion of your portfolio to a single NBFC. Limit exposure to 5–10% of overall fixed income allocation.
Overall View: Moderate Risk – Suitable for medium risk investors seeking higher yield than bank FDs.
Frequently Asked Questions (FAQs)
- Is IIFL Finance NCD February 2026 secured?
Yes, these are secured NCDs with 100% security cover. - What is the highest interest rate offered?
Up to 9.00% per annum. - What is the minimum investment amount?
₹10,000 (10 NCDs). - Are these NCDs listed?
Yes, proposed to be listed on NSE and BSE. - Is interest taxable?
Yes, interest is taxable as per your income tax slab. - Can I sell before maturity?
Yes, after listing you can sell on stock exchanges, subject to liquidity. - Is this better than bank FD?
Returns are higher, but risk is also higher compared to bank FDs.
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