Public Issue of JM Financial Credit Solutions Limited NCD (Secured)
Issue Opens: 28-May-2018
Issue Closes: 20-June-2018
Issue Size: ₹ 750 Crs
Ret: ₹ 225 Crs
HNI: ₹ 225 Crs
Corp: ₹ 150 Crs
QIB: ₹ 150 Crs
Instrument: Secured NCD
Rating: AA/Stable by ICRA and India Ratings
? Coupon For All Category
9.25% p.a. for 38 Months (Annual)
9.11% p.a. for 5 Years (Monthly)
9.50% p.a. for 5 Years (Annual)
9.34% p.a. for 10 Years (Monthly)
9.75% p.a. for 10 Years ( Annual)
? Interest Option: Monthly, Annual & Cumulative
? Allotment first come first serve basis.
- JM Financial Credit Solutions Limited (JMFCSL) is a “Systemically Important Non-Deposit taking Non-Banking Financial Company (“NBFC ND – SI”)”, registered with Reserve Bank of India to carry on NBFC activities originally incorporated at Mumbai, Maharashtra.
- JM Financial Credit Solutions Limited is a wholesale finance NBFC and provides integrated financial solutions to real estate developers with a focus on residential project financing such as funding real estate developers at various stages in the life cycle of a real estate project.
- The company has clients in Mumbai, Pune, Bengaluru, Chennai, Hyderabad, NCR and Kolkata.
- The product portfolio consists of Project Finance, Loans against property, Loans against shares, Project at early stage loans and Loans againstland.
- The company recorded total revenue of Rs. 6.00 crore, Rs. 103.73 crore, Rs 519.45 crore, Rs 788.36 crore and Rs 959.93 crore Fiscal 2014, Fiscal 2015, Fiscal 2016, Fiscal 2017 and Fiscal 2018 respectively. The total revenue increased at a CAGR of 109.9% from Fiscal 2015 to Fiscal 2018.
- The company recorded profit before tax of Rs 2.69 crore, Rs 70.22 crore, Rs 301.72 crore, Rs 424.78 crore and Rs 504.04 crore Fiscal 2014, Fiscal 2015, Fiscal 2016, Fiscal 2017 and Fiscal 2018, respectively. The profit before tax increased at a CAGR of 92.9% from Fiscal 2015 to Fiscal 2018. The profit after tax increased at a CAGR of 88.8% from Fiscal 2015 to Fiscal 2018.
- The loan book was Rs 1,844.46 crore, Rs 4,074.47 crore, Rs 5,658.15 crore and Rs 7,338.88 crore, as of March 31, 2015, 2016, 2017 and 2018, respectively. And gross and net NPAs were nil in Fiscal 2015, Fiscal 2016, Fiscal 2017 and were Rs 75.80 crore and Rs 68.22 crore in Fiscal 2018, respectively, constituting 1.0% and 0.9% of the net advances as of March 31, 2018, respectively.
- Strong background of shareholders along with brand name and parentage of the JM Financial GroupJM Financial Group is an established financial services group providing a range of financial services. The group’s long standing operations in the financial services sector has resulted in establishing JM Financial as a recognized brand. The primary business of the Group includes fund based activities, investment banking and securities business, alternative asset management business and asset management business which involves the mutual fund business. The group’s client focused business approach over four decades has enabled to develop strong relationships across the corporate, institutional, HNI and the retail client base. JMFCSL leverages the Group’s experience in the various facets of the financial services sector which allows it to understand market trends and mechanics.
- Well positioned to benefit from industry trendsThe company’s approach to be senior secured lender at all times together with the focus on risk adjusted profitable growth, has enabled it to develop a consistently profitable and sustainable business model. Further, as the company has expanded geographically and source new clients it will be able to capitalize on the growth opportunities.
- Strong financial and operating performance reflected in strong growth, asset quality and returnsJMFCSL has a track record of stable and sustainable financial performance, reflected in the consistent growth in revenues and profitability. The company recorded total revenue of Rs. 6.00 crores, Rs. 103.73 crores, Rs. 519.45 crores, Rs. 788.36 crores and Rs. 959.93 crores for Fiscal 2014, Fiscal 2015, Fiscal 2016, Fiscal 2017 and Fiscal 2018 respectively. The profit before tax increased at a CAGR of 92.9% from Fiscal 2015 to Fiscal 2018. The profit after tax increased at a CAGR of 88.8% from Fiscal 2015 to Fiscal 2018.
- Wide customer base, strong customer relationships and geographic diversificationWith a predominant focus on financing residential development, the company is currently focused on funding projects located in Tier 1 cities such as Mumbai, Pune, Bengaluru and Chennai. JMFCSL has successfully carried out lending against a few completed, commercial properties, in Mumbai and Bengaluru and has recently commenced financing projects in Kolkata, Hyderabad and NCR.
- Well Defined process, secured loan book and strong asset qualityJMFCSL provides secured finance which ensures lower NPAs and fewer recovery related problems. As at March 31, 2018, 98.3%, of the total loan book was secured and gross NPAs and NPAs constituted 1.0% and 0.9% of total loan book, respectively. Loans against property are secured against collateral of residential or commercial property while loans against securities are offered against collateral of securities. JMFCSL’s business processes ensure complete independence of function and segregation of responsibilities. The processes have been standardized with the objective of providing high levels of service quality while maintaining process and time efficiency. JMFCSL continues to manage the credit risk associated with the lending business and has accordingly been able to increase its customer base and client accounts across the loan book
- Diversified funding sources and strong credit profile adequately capitalized to fund the growthThe funding requirements are currently predominantly met through credit facilities from banks, issuance of commercial paper and redeemable non-convertible debentures and commercial papers. The company has access to funds from multiple classes of credit providers, including public sector banks, private commercial banks and mutual funds. As at March 31, 2018, the capital adequacy ratio, which was computed on the basis of the applicable RBI requirements, was 22.4%, as compared to the minimum capital adequacy requirement of 15.00% as stipulated by the RBI.
- Experienced management teamThe company has an experienced management team, which is supported by a capable and motivated pool of employees. JMFCSL believes that the considerable experience of the Board and senior management team in the financial services sector is a significant competitive advantage that has enabled it to successfully grow a profitable and sustainable business model.