Kosamattam Finance Limited, a well-established gold loan NBFC, is coming up with its latest Non-Convertible Debenture (NCD) issue in March 2025. With competitive interest rates and secured nature, this NCD offers an attractive investment opportunity for those seeking fixed-income options. In this article, we will review the Kosamattam Finance NCD March 2025 details of this NCD issue, including interest rates, credit ratings, risks, and benefits, to help investors decide whether to invest or avoid this offering.
About Kosamattam Finance Limited
Kosamattam Finance is a non-deposit-taking NBFC primarily engaged in gold loan financing. Headquartered in Kottayam, Kerala, it operates across multiple states, including Kerala, Tamil Nadu, Karnataka, Andhra Pradesh, Maharashtra, Delhi, Gujarat, and Telangana. Apart from gold loans, the company provides microfinance, money transfer services, foreign exchange, and agricultural finance. As of December 31, 2024, it had a vast branch network of 975 branches and employed 3,697 people.
Kosamattam Finance NCD – March 2025 Issue Details
- Issue Open Date: March 26, 2025
- Issue Close Date: April 11, 2025
- Issue Type: Secured, Redeemable, Non-Convertible Debentures (NCDs)
- Base Issue Size: ₹ 100 Crores
- Overall Issue Size (with oversubscription): ₹ 200 Crores
- Issue Price: ₹ 1,000 per NCD
- Minimum Investment: 10 NCDs (₹ 10,000)
- Listing: BSE (Bombay Stock Exchange)
- Credit Rating: IND A-/Stable by India Ratings & Research
- Tenure Options: 18, 24, 30, 36, 39, 48, 60, and 84 months
- Interest Payment Modes: Monthly and Cumulative
- Allotment Basis: First Come, First Serve
Interest Rates on Kosamattam Finance NCD – March 2025
The NCDs come with different series offering monthly and cumulative interest options. Below is the interest rate structure:
| Series | Interest Payment | Tenure | Coupon Rate (p.a.) | Effective Yield (p.a.) | Maturity Amount (per ₹ 1,000) |
|---|---|---|---|---|---|
| I | Cumulative | 18 M | NA | 9.25% | ₹ 1,142 |
| II | Monthly | 24 M | 9.25% | 9.92% | ₹ 1,000 |
| III | Cumulative | 36 M | NA | 9.75% | ₹ 1,322 |
| IV | Monthly | 36 M | 10% | 10.47% | ₹ 1,000 |
| V | Cumulative | 39 M | NA | 10.17% | ₹ 1,370 |
| VI | Monthly | 60 M | 10.25% | 10.75% | ₹ 1,000 |
| VII | Cumulative | 48 M | NA | 10.67% | ₹ 1,500 |
| VIII | Cumulative | 84 M | NA | 10.41% | ₹ 2,000 |
Credit Rating
The NCDs have been rated IND A-/Stable by India Ratings & Research Private Limited. This rating indicates an adequate degree of safety regarding financial obligations but carries low credit risk.
Why to Invest in Kosamattam Finance NCD – March 2025?
- Attractive Interest Rates – Offers up to 10.75% effective yield.
- Secured NCDs – Backed by company assets, reducing the risk of default.
- Regular Monthly Income – Suitable for investors looking for fixed income.
- Credit Rating of A- (Stable) – Indicates a fair level of safety.
- Diversified Loan Portfolio – Company has a strong presence in multiple financial services apart from gold loans.
Why Not to Invest in Kosamattam Finance NCD – March 2025?
- Risk of Default – Despite an A- rating, risks exist as NBFCs can face liquidity issues.
- Not Rated AAA or AA – A lower rating than top-rated NCDs in the market.
- Gold Loan Business Volatility – Gold prices fluctuate, impacting the company’s performance.
- Liquidity Issues – Unlike FDs, early exit is challenging as trading on BSE is low.
How to Apply for Kosamattam Finance NCD?
You can apply for this NCD via:
- Online through Demat Account: Apply through brokers like Zerodha, ICICI Direct, HDFC Securities, etc.
- Offline via physical forms: Submit forms at designated banks and brokers.
- Allotment is on a first-come, first-serve basis, so early applications are recommended.
Should You Invest in Kosamattam Finance NCD – March 2025?
Kosamattam Finance’s March 2025 NCD issue offers good interest rates, making it suitable for investors seeking fixed-income investments. However, as it is an NBFC NCD, there is some risk involved. Investors willing to take risks for higher returns can consider investing, but those preferring safer options should look at AAA-rated NCDs or bank FDs.
Frequently Asked Questions (FAQs)
1) What is the minimum investment in Kosamattam Finance NCD?
The minimum investment is 10 NCDs (₹ 10,000).
2) Are Kosamattam Finance NCDs safe?
These are secured NCDs rated IND A-/Stable, but they are not risk-free.
3) How is interest paid on Kosamattam Finance NCDs?
Investors can opt for monthly or cumulative interest payment.
4) Can I exit before maturity?
Yes, they can sell on BSE, but liquidity may be low.
5) Is interest on NCDs taxable?
Yes, interest earned is taxable as per your income tax slab.
6) What is the risk in Kosamattam Finance NCDs?
NBFCs carry business risks and may face liquidity issues in adverse market conditions.
7) How do I apply for Kosamattam Finance NCDs online?
You can apply through your Demat account via brokers like Zerodha, ICICI Direct, and HDFC Securities.
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