Muthoot Finance Ltd, the largest gold loan company in India, has announced that it has raised USD 400 million (approximately Rs.3350crs) through issuance of Senior Secured Notes (Notes) under its Global Medium Term Note Program of USD 2 billion in compliance with External Commercial Borrowings (ECB) guidelines of Reserve Bank of India.

The coupon for the Notes has been set at 6.375% p.a. and is issued with a door-to-door maturity of 4.5 years and average period of 4 years.

The order book peaked at over USD 1.3 billion with an oversubscription of 3.9x and final participation from 125+ investors across the globe. The bonds were rated by International Credit Rating agencies S&P and Fitch with BB/Stable rating. The issue was in compliance with Rule 144A under the U.S. Securities Act of 1933.

The funds raised will be used for onward lending and other activities permitted under External Commercial Borrowing guidelines of Reserve Bank of India.

The Notes are listed in NSE IX, Gift City, Gujarat.

Deutsche Bank and Standard Chartered Bank were the Arrangers and Dealers for the issuance.

Muthoot Finance had previously raised USD 450 million in 2019 and USD 550 million in 2020 which was repaid on respective due dates in 2022 and 2023 respectively. In the current financial year, the company had already raised USD 750 million under the same route for a period of 3.75 years at a coupon of 7.125%.

Speaking on the fund raise, Mr. George Alexander Muthoot, Managing Director, Muthoot Finance Ltd, said, “This fund raise of USD 400 million, as a part of the USD 2 billion Global Medium Term Note program, will further strengthen our partnership with global investors. We saw a great response from global investors on the back of our resilient performance, commitment to our customers, and a successful track record of gold loan business in India. This also helped us in reducing the coupon rate on the Notes to 6.375% vis-à-vis the earlier issuance at a coupon rate of 7.125% even though the period has increased to 4.5 years compared to 3.75 years for the previous issue. The issue will help the company to achieve higher loan disbursements as well as further diversify the sources of its borrowing and widen the investor base.”