Tata Capital, the NBFC arm of the Tata Group, is looking to raise Rs 7,500 crore through a public issue of non-convertible debentures (NCD) in only the second such exercise by the company – and the first offer this decade.
“The company has received in-principle approval from the exchange and is likely to receive approval from the ROC soon. The public issue is likely to open for investors in the second week of September,” said a source close to the development.
A spokesperson for Tata Capital declined to comment on the subject.
“There is a lot of comfort among investors with AAA-rated instruments,” said Ajay Manglunia, Head (fixed Income Advisory), Edelweiss Financial. “NCDs from a reputed group will see good demand from fixed-income investors.”
Recently, Tata Capital has seen its ratings climb to AAA from AA+, with upgrades from rating agencies such as Crisil and ICRA.
Tata Capital will offer NCDs with a face value of Rs 1000. These NCDs will have tenures of 3 years, 5 years and 10 years, with interest rates in the range of 8.7-9%. The company plans to pay 10 basis points more to retail and HNI investors. Of the total issue size, 30% will be reserved for retail investors, who can invest up to Rs 10 lakhs.