J M Financial Credit NCD Issue review (May apply)

•   This is the second debt offer from JMFCSL within a span of six months.
•   Issue is rated ICRA/AA stable and IND/AA stable.
•   Allotment will be in demat mode only and on First come- First served basis.
•   Listing will be only on BSE.

ABOUT COMPANY:
J M Financial Credit Solutions Ltd. (JMFCSL) is a systematically important non-deposit taking non-banking financial arm of JM Financial group. It is engaged in providing integrated financial solutions to real estate developers with a focus on residential project financing.

As of September 30, 2018, it had 85 borrower groups in this business, and the average ticket size of advances per borrower group was Rs. 102.80 cr.

The consolidated revenue and profit after tax of JM Financial Limited for half year ended September 30, 2018 stood at Rs. 1828.17 cr. and Rs. 306.08 cr. respectively. As of September 30, 2018, advances towards residential projects represented 73.5% of its total advances and cash flow backed advances represented 86.3% of our total advances. As of September 30, 2018, advances towards residential projects and commercial projects represented 73.5% and 16.9% of its total advances respectively. As on said date its Gross and Net NPAs stood at 0.8% and 0.6% respectively and debt/equity ratio was 2.5. On standalone basis these are 0.9%, 0.7% and 2.6 respectively.

ISSUE DETAILS:
JMFCSL is coming out with its Tranche II Secured, Rated, Redeemable, Non-Convertible Debenture issue to mobilize Rs. 250 cr. with a green shoe option to retain oversubscription of Rs. 1000 cr. thus making Tranche II size of Rs. 1250 cr. out of shelf limit of Rs. 2000 cr. Earlier in May-June 2018 it came with a NCD issue of Rs. 750 cr. under Tranche I. The company is issuing NCDs having face value of Rs. 1000 each with tenure of 42 months, 60 months and 120 months. Interest payment options available are monthly, annually or cumulative as per the choice of investors. It carried coupon rates ranging from 9.67% to 10.25%. These NCDs have been rated as ICRA/AA stable and IND/AA stable by ICRA and India Rating respectively. These rating indicate high degree of safety regarding timely servicing of financial obligations.

Minimum application is to be made for 10 NCDs (i.e. Rs. 10000) and in multiple of 1 NCD (i.e. Rs. 1000) thereon, thereafter. Issue opens for subscription on 20.11.18 and will close on or before 20.12.18. Allotment will be compulsorily in demat mode and application is to be made under ASBA mode only. Allotment will be made on 'First Come – First Served' basis. Post allotment, NCDs will be listed on BSE. Issue is jointly lead managed by A K Capital Services Ltd., J M Financial Ltd., Edelweiss Financial Services Ltd. and Trust Investment Advisors Pvt. Ltd. While Karvy Computershare Pvt. Ltd. is the registrar to the issue, IDBI Trusteeship Services Ltd. is the debenture Trustee.

Conclusion / Investment Strategy

Considering rating and the lucrative coupon rates, investors looking for long term steady income may consider investment

Review By Dilip Davda on November 15, 2018

Review Author

DISCLAIMER: No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor prior to making any actual investment decisions, based on information published here. Any reader taking decisions based on any information published here does so entirely at own risk. Investors should bear in mind that any investment in stock markets are subject to unpredictable market related risks. Above information is based on RHP and other documents available as of date coupled with market perception. Author has no plans to invest in this offer.

(SEBI registered Research Analyst-Mumbai).

About Dilip Davda

Dilip Davda is veteran journalist associated with stock market since 1978. He is contributing to print and electronic media on stock markets/insurance/finance since 1985.

Dilip Davda is a leading reviewer of public issues and NCDs in the primary stock market in India. The knowledge he gained over 3 decades while working in the stock market and a strong relationship with popular lead managers makes his reviews unique. His detail fundamental and financial analysis of companies coming up with IPO helps investors in the primary stock market. Dilip Davda has a special interest in analyzing the SME companies and writing reviews about their public issues. His reviews are regularly published online and in news papers.

Email: dilip_davda@rediffmail.com

The JM Financial NCD Nov 2018 Analysis helps you to understand about the company, offer detail, valuation, capital structure and financial performance. Our SEBI registered NCD Analysts tells you if JM Financial NCD Nov 2018 worth investing. The JM Financial NCD Nov 2018 Note sets the NCD expectations in systematic way which tells you if JM Financial NCD Nov 2018 good to buy (good or bad / yes or no). The NCD Forecast tells you weather to invest in JM Financial NCD Nov 2018 by providing NCD recommendations i.e. subscribe, avoid and neutral.

J M Financial Credit NCD Issue review (May apply)

Conclusion / Investment Strategy

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