Arman Financial Services Ltd (Arman), a Gujarat based non-banking financial company (NBFC), with interests in microfinance, two-wheelers, and micro-enterprise (MSME) loans, announced that its wholly-owned subsidiary "Namra Finance Ltd" which manages the microfinance business of the group, raised Rs. 66.3 crores of debt capital from MUDRA, and the IIV Mikrofinanzfonds, Germany (external commercial borrowing) Highlights of the Borrowing Transactions.
1. Borrowed Rs. 25 Crores from MUDRA at a 6.4% rate of interest, on 17th March, 2020. (Tenure: 2 years)
2. Raised external commercial borrowing (ECB) of Rs. 41.3 Crores, from IIV Mikrofinanzfonds, Germany at a 12.0% rate of interest (inclusive of hedging cost), on 16th March, 2020. This loan is fully hedged, and has a tenure of 3 years with a bullet repayment structure.
Mr. Jayendra Patel, Vice Chairman & Managing Director, Arman Financial Services, said, "both these debt capital raising transactions from MUDRA, and the IIV Mikrofinanzfonds on favourable terms are very positive developments from our liability management standpoint, especially in light of the current COVID-19 crisis. With the conclusion of these two transactions and our normal cash reserves, we have sufficient liquidity to manage temporary closures related to COVID-19. They are also a testament to our strong balance sheet, performance, and vintage. Our leverage position is comfortable, and our credit rating has remained stable at BBB+ (CARE Ratings). This capital has been raised at rates below our overall average borrowing cost, and hence will be NIM accretive. Furthermore, since these are relatively longer-tenure borrowings, they will also help in further improving our ALM position.
The transaction with IIV Mikrofinanzfonds is the first time that NAMRA has raised external commercial borrowing, and it opens up access to global debt capital markets for both "Arman" and "Namra". The borrowing from MUDRA also represents our first transaction with them and is the lowest interest rate received by company till date.
Shares of ARMAN FINANCIAL SERVICES LTD. was last trading in BSE at Rs.443.55 as compared to the previous close of Rs. 492.8. The total number of shares traded during the day was 2414 in over 101 trades.
The stock hit an intraday high of Rs. 480 and intraday low of 443.55. The net turnover during the day was Rs. 1090498.