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    IndoStar Capital Finance board okays Rs 10,000 crore fund raise plan through bonds

    Synopsis

    The decision was taken at the company's board of directors meet on August 12 to declare and approve quarterly results for quarter ended June 2020, the non-banking finance company said in a regulatory filing.

    BondsETBFSI
    IndoStar said it will seek shareholders nod for the debt raise plan in its ensuing annual general meeting scheduled for September 24, 2020.
    NEW DELHI: Non-bank lender IndoStar Capital Finance on Thursday said it will raise up to Rs 10,000 crore by issuing bonds on a private placement basis. The decision was taken at the company's board of directors meet on August 12 to declare and approve quarterly results for quarter ended June 2020, the non-banking finance company said in a regulatory filing.

    The board of directors considered and approved to issue "non-convertible debentures for an amount not exceeding Rs 10,000 crore on private placement basis, in one or more tranches during a year from the date of approval by shareholders of the company", it said in the filing.

    IndoStar said it will seek shareholders nod for the debt raise plan in its ensuing annual general meeting scheduled for September 24, 2020.

    The company registered a flat growth in its consolidated net profit at Rs 47 crore in the first quarter ended June of the current fiscal year.

    Income during the April-June period of 2020-21, however, fell to Rs 322.28 crore as against Rs 419.06 crore in the year-ago quarter.

    IndoStar said it has closed Rs 1,225 crore equity capital injection by Brookfield Business Partners LP, together with its institutional partners (collectively Brookfield).

    "All three tranches of the Brookfield investment - the equity infusion, the open offer and the secondary offering of shares have been successfully completed. Brookfield is now a co-promoter along with Everstone and is represented on the board by two directors," it said in a release.

    With this equity infusion, IndoStar has one of the highest capital adequacy ratios of 37.7 per cent amongst all listed NBFCs, it said.

    The company said it has a strong liquidity position and low debt to equity ratio (1.8x), which positions IndoStar well to further accelerate its retailisation strategy in a challenging market environment and equips it with the ability to use capital for both organic and inorganic growth.

    The company currently has liquid assets of around 29 per cent of its borrowings, sufficient to cover its repayment obligations till March 2021. The company has raised Rs 730 crore since the lockdown, it added.

    "With the economy slowly moving towards normalcy, IndoStar, with transformational investment by Brookfield and focused retailisation strategy, is well placed to grow and capture market share in CV (commercial vehicle), affordable housing finance and SME businesses," said R Sridhar, Executive Vice-Chairman & CEO, IndoStar.

    Stock of IndoStar traded 0.14 per cent up at Rs 256 apiece on BSE.



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    Download The Economic Times News App to get Daily Market Updates & Live Business News.

    Subscribe to The Economic Times Prime and read the Economic Times ePaper Online.and Sensex Today.

    Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price

    ...more
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