Indiabulls Housing Finance rallies on the back of debenture issue

The company is set to raise Rs 1000 crore through NCDs.

Indiabulls Housing Finance Ltd has been one of the buzzing stocks on Dalal Street. The company had announced on December 4, 2021, about the issue of secured, redeemable, non-convertible debentures of the face value of Rs 1000 each for an amount of Rs 200 crore which is the base issue size, with an option to retain oversubscription up to Rs 800 crore, totalling to Rs 1000 crore. The issue is being offered by way of the tranche I prospectus. The company had successfully raised Rs 792 crore through the issue of NCDs in September 2021, which was oversubscribed by 4x of the base issue size.

The issue's opening date is December 9, 2021, and the closing date is December 20, 2021. The issue is to be listed on both BSE and NSE exchanges, wherein the BSE is the designated stock exchange. The credit rating by CRISIL has been CRISIL AA/Stable. The issue has the tenor of 24 months, 36 months and 60 months.

The marquee investor Rakesh Jhunjhunwala has a 1.08% stake in the company as of September 2021. As for the quarterly results for September, the results haven’t been bad or good either. It has been stabilizing, which may be considered an affirmative point. The lower interest rate environment has boosted the growth in the real estate sector. The company has benefitted from this upward trajectory. The management expects the assets under management to further stabilize from Q3FY22 onwards.

The company has developed co-lending partnerships with HDFC, Central Bank of India, Yes Bank and other banks, making a total of 7 co-lending partnerships as of Q2FY22. The company has a net NPA of 1.53% while in Q2FY21 it was 1.63%. It has high provisioning in place with the ratio of total provisions to gross NPA being high at 152%.

As of December 8, 2021, at 1:30 pm, the stock is trading at Rs 250.20, up by 1.3% on the BSE.