TATA Capital Financial Services Limited NCD 2019 Tranche-II
(i) TCFSL, setup in 2010, it is a wholly-owned subsidiary of TCL. Following the change in shareholding structure for the financial business, TCL transferred its lending business along with part of liabilities to TCFSL with effect from March 2012. At the end of Fiscal 2018, the Company’s has a sizeable AUM of 37,260 Cr.
(ii) TCFSL is a Systemically Important Non – Deposit-taking Non – Banking Financial Company (“ND – SI – NBFC”) focused on providing a broad suite of financing products customized to cater the needs of various segments. The financing products include:
a) Corporate finance:
The Corporate Finance Division (“CFD”) offers commercial finance which offers vaNilla term loans, working capital term loans, channel finance, bill discounting, construction equipment finance, leasing solutions, lease rental discounting, promoter finance and structured products.
b) Consumer finance:
The Consumer Finance and Advisory Business Division (“CFABD”) offers a wide range of consumer loans such as car and two-wheeler loans, commercial vehicle loans, tractor loans, business loans, loans against property, personal loans, consumer durable loans and loans against securities.
(ii) They are promoted by and are a wholly-owned subsidiary of TCL, which is a diversified financial services company providing services through its subsidiaries to retail, corporate and institutional clients. TCL is the financial services arm of the Tata group, which is a diversified global business group serving a wide range of customers across varied sectors such as steel, motors, power, chemicals, telecommunications, and hospitality.
Objective of NCD TATA Capital Financial Services Limited NCD 2019 Tranche-II:
(i)TCFSL is coming out with debt offer of NCDs with a base size of ₹500 cr with a greenshoe option to retain oversubscription of ₹3626 cr. The issue consists of 2997.90 crore Secured Non-convertible debentures and ₹1128.10 cr. Un-secured Non-Convertible Debentures are aggregating to ₹4126 cr.
(ii) The purpose of NCD is onward lending, financing, and for repayment /prepayment of interest and principal of existing borrowings of TCFSL.
TATA Capital Financial Services Limited NCD 2019 Tranche-II Details:
| Open Date: | Aug 13 2019 |
| Close Date: | Aug 20 2019 |
| Issue Size: | ₹ 500 Cr. |
| Face Value: | ₹ 1000 Per NCD |
| Market Lot: | 10 NCD |
| Minimum Order Quantity: | 10 NCD |
| Listing At: | NSE,BSE |
Promoters:
The Promoter is Tata Capital Limited.
Credit Rating:
(i) "CRISIL AAA / Stable" for an amount of up to 7500 Cr by CRISIL Limited vide its letter dated August 15, 2018, and further revalidated by letter dated August 27, 2018.
(ii) "CARE AAA; Stable" for an amount up to 7500 Cr by CARE Ratings Limited vide its letter dated August 14, 2018, and further revalidated by letter dated August 27, 2018.
Conclusion:
The ratings of the NCDs issued by CRISIL and CARE Limited indicate the highest degree of safety regarding timely servicing of financial obligations.
Interest Rates:
| Series | I | II | III | IV |
| Frequency of Interest Payment | Annual | Annual | Annual | Annual |
| Tenor | 3 Years | 5 Years | 8 years | 10 Years |
| Coupon rate for I & II | 8.35% | 8.40% | 8.55% | 8.75% |
| Coupon rate for III & IV | 8.45% | 8.50% | 8.65% | 8.85% |
| Nature of indebtedness | Secured Rated NCD | Secured Rated NCD | Secured NCD | Unsecured NCD |
Post Tax returns:
(i) Sold after Maturity The interest earned through NCDs will be added to the total income and will be taxed at 5%, 20%, and 30% respectively depending upon the income slab of an Individuals.
(ii) Sold Before Maturity If you decide to sell the NCDs on the stock exchange, capital gains can also arise. If NCDs are sold within a period of 12 months from the date of allotment, short term capital gains/loss (STCG) will arise and if you decide to sell NCDs after a period of 12 months, the resulting gain or loss is called long term capital gains/loss (LTCG).
Recommendation:
Review and Recommendation of TATA Capital Financial Services Limited NCD by InvestorZone team => 6/10
1-5: Fair
5-7: Good
7-10: Excellent
[ This is a very good NCD considering a turmoil going on in NBFC market. The company has a strong promoter in the form of Tata Capital Limited which gives confidence in this market. The interest rates are very attractive. It is first come first serve basis.]
Discussion on TATA Capital Financial Services Limited NCD 2019 Tranche-II:
11 Comments
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Tata capital finance ncd will list tomorrow
Hi MW,
I do have some SREI NCD’s which are showing current market price less then the actual brought price. My question is after maturity will they pay actual price or market price?
sir, if there is no issue in the company as that of DHFL and if the company is paying interest on time than you need not worry. Coming back to your question, yes after maturity the company will pay the actual price.
Thanks, MW..Hopefully SREI will sustan for long!!
Issue closed today.
Live Subscription:
https://www.bseindia.com/markets/publicIssues/BSEcumu_demand.aspx?ID=1948
Retail quota already oversubscribed.
Subscription status please @ Market Wizard
Highlights of the NCD
(i) Public Issue Of Secured Redeemable NCDs & Unsecured Subordinated Redeemable NCDs
(ii) Issue Size: INR 4126 Crs (out of which INR 2997.90 Crs Secured & INR 1128.10 Crs unsecured)
(iii) Open: 13-Aug-2019 & Close 23-Aug-2019
(iv) Allotment First come First serve basis
(v) Coupon for HNI & Retail:
3 Years (Secured): 8.45% p.a.
5 Years (Secured): 8.50% p.a.
8 Years (Secured): 8.65% p.a.
10 Years (Unsecured): 8.85% p.a.
(vi) Coupon for Institutional & Corporate:
3 Years (Secured): 8.35% p.a.
5 Years (Secured): 8.40% p.a.
8 Years (Secured): 8.55% p.a.
10 Years (Unsecured): 8.75% p.a.
(vii) Rating: CRISIL AAA / Stable and CARE AAA; Stable
In Sept 2018, the Tata Capital comes up with an NCD at FV=1000 which is now trading at 1088 as on 07.08.2019. So an additional gain of 8.8% in the price itself apart from the fixed interest which NCD carries.
When there is a crisis in the sector performance like this speaks volumes about the company.
Grabs this Opportunity with both hands as it is first to come and first to serve opportunity.
@Market Wizard
All NCD issued by Tata Capital in 27th September 2018 are with annual interest option. Company will pay annual interest on 27th September 2019. NCD which is trading at 1088 is Cum Interest price. Company will announce its record date and ex date shortly. Most probably Ex date will be 11th September 2019. Price will settle around 1000-1020 on ex date.
Okay thanks for the clarification Tejas bhai.