CreditAccess Grameen secures Rs 990cr through NCD public issue

Massive Capital Raise by CreditAccess Grameen: In a significant financial move, CreditAccess Grameen Limited (NSE: CREDITACC, BSE: 541770), the largest Non-Banking Financial Company-Micro Finance Institution (NBFC-MFI) in India, has successfully raised a whopping INR 989.58 crore through a public issue of secured, redeemable Non-Convertible Debentures (NCDs). These NCDs are now listed on both the National Stock Exchange of India Ltd (NSE) and the Bombay Stock Exchange (BSE), solidifying the company’s financial standing.

Issue Oversubscribed: Initially having a base issue size of INR 400 crore, the NCD Tranche II Issue included an option to retain oversubscription up to INR 600 crore, with a shelf limit of INR 1,500 crore. The issue opened for subscription on August 24, 2023, and closed early on September 1, 2023, due to overwhelming interest. The issue was oversubscribed, receiving a total subscription of about INR 1,012 crore, which is 2.53 times the base issue size. CreditAccess Grameen chose to exercise the option to retain the oversubscription, allocating a total of 98,95,794 NCDs, each with a face value of INR 1,000.

High Ratings and Diverse Subscription: The NCDs have been rated as IND AA-/Stable by India Ratings and Research Private Limited. The issue witnessed broad-based participation, with a 2.47 times subscription of the base issue size of INR 400 crore. The institutional category was subscribed 2.50 times, the non-institutional category 2.68 times, the HNI category 2.14 times, and the retail category 2.46 times. Investors were offered monthly and cumulative interest options, with effective yields ranging from 9.48% to 10.13% per annum.

Management Commentary: Udaya Kumar Hebbar, Managing Director of CreditAccess Grameen Ltd., spoke about the successful NCD issue, stating, “This monumental capital raise signifies investor confidence in our unique business model, aimed at advancing financial inclusion across rural India. Our liability strategy focuses on diversifying funding sources and increasing the share of longer-tenure funds, thereby leading to a stronger liquidity position.”

With this successful capital raise, CreditAccess Grameen Limited further cements its role as a major player in India’s NBFC-MFI sector, as it continues to advance its financial inclusion agenda across rural India.