Shriram Transport Finance Company (STFC), a flagship company of Shriram group, on Tuesday said that it plans to raise Rs 500 crore through sale of secured non- convertible debentures (NCDs) of face value of Rs 1,000 each.
"We are raising the funds for the third time through the NCD route as we expect the market of vehicle finance to grow.
The funds shall be used for our business expansion," STFC Deputy Managing Director Umesh Revankar told reporters.
The company will be paying an interest ranging between 11.1-11.6% on these bonds, he said.
The issue opens on June 27 and closes on July 9.
The NCD issue would aggregate up to Rs 500 crore with an option to retain over subscription of upto Rs 500 crore, he said.
"The company with assets under management (AUM) to the tune of Rs 36,000 crore as on March 31, this year, enjoys close to 20% market share in commercial vehicle financing," Revankar said.
The company has proposed to expand its operations in pre- owned commercial vehicle financing through hubs called Automall, which serve as stockyard services for pre-owned and repossessed commercial vehicles.
"Currently we have two Automalls, one each in Chennai and Vadodara. We intend to gradually expand the number of such malls to 50 or 60 over the next two years period," Revankar said.
"We are in the process of identifying and acquiring properties on a leasehold basis at various locations," he said.
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