Edelweiss Housing Finance Limited is a company under the conglomerate of the Edelweiss Group. Edelweiss Housing Finance Limited is a company engaged in the business of the housing finance sector. The company’s portfolio includes Secured Home Loans used to purchase and construct and renovate the residential properties. The company also carries out Non-Housing Finance Loans, where the company distributes loans against the property. The loan that has been distributed in this category is used for the purchase of commercial property, business purposes and Construction Finance used in the development and the construction of residential projects. This article explains here you can read about Edelweiss Housing Finance Limited NCD IPO.
Edelweiss Housing Finance Limited also offers small-ticket in unsecured loans to individuals. In this category of business operation, the company has a market presence mainly in rural areas and corporates. Currently, the company has 68 offices in 67 cities in the country with an employee base of 554 employees.
The disbursement of unsecured loans has generated a major part of the company’s revenue from individuals. It is roughly around 60% of the company’s total loan book, while the other 40% of its loan book is from loans against property and construction loans. Edelweiss Housing Finance Limited has a Pan-India presence with a growing brand outlook for future growth. The company’s average borrowing costs in the medium term over the last 3 to 4 years are 9% to 9.5% per annum. The company also has a very capitalized entity and an equity base as per the regulatory requirements. Although on the financial aspect, the company’s performance looks solid but the non-performing loan proportion of the company has registered a sharp increase from 1.8% in FY19 to 3.5% in FY21. Let’s have a look at Edelweiss Housing Finance performance on TradingBuzzr.
OBJECTS OF THE ISSUE:
The company stated that the funds been raised from the proceeds of the NCD would be utilized to:
- For onward lending.
- Financing along with the repayment and the prepayment of the interest and the principal of the outstanding dues of the company.
- General Corporate Purposes.
EDELWEISS HOUSING FINANCE NCD IPO DETAIL:
Edelweiss Housing Finance Limited has opened up their second non-convertible debentures offer of Rs. 1000 each. The NCD offer is worth Rs. 150 crores. The NCD offer also has a greenshoe option to retain the oversubscription in the NCD plan to the tune of Rs. 150 crores. The NCD offer’s overall size and the debt offering will be Rs. 300 crores. The minimum application is 10 NCDs worth Rs.10000. Post allotment of the NCD, the company’s stock will be listed on BSE. The company also stated that it would spend around Rs. 6.7 Crores on NCD offer. Check Day by Day IPO Subscription Details (Live Status)
| Issue Open | April 6, 2022 to April 26, 2022 |
| Security Name | Edelweiss Housing Finance Limited |
| Security Type | Secured, Redeemable Non-Convertible Debentures |
| Base Issue Size | Rs. 150.00 Crores |
| Shelf Issue Size | Rs. 150.00 Crores |
| Issue Price | Rs. 1000 per Non-Convertible Debentures |
| Face Value | Rs. 1000 each Non-Convertible Debentures |
| Minimum Lot size of NCD | 10 NCD that corresponds to Rs.10,000 |
| Market Lot of the NCD | 1 NCD |
| Listing At | BSE |
| Credit Rating | Credit rating as per CRISIL: CRISIL AA-/ Negative and ACUITE AA/ Negative |
| Tenor of the NCD | 24, 36, 60 and 120 months |
| Series | Series I to X |
| Payment Frequency of the NCD | Monthly, Annual and Cumulative |
| Basis of Allotment of the NCD | First Come First Serve Basis |
| Options | Tenure | Frequency of Interest Payment | Coupon (% per annum) for NCD Holders in Category I, II, III & Iv | Redemption Amount (₹ /NCD) on Maturity for NCD Holders in Category I, II, III & IV (%) | Effective Yield for NCD Holders in Category I, II, III & IV (%) | Put and Call Option |
| I | 24 months | Annual | 8.50% | 1,000 | 8.49% | NA |
| II | 24 months | Cumulative | NA | 1,177.50 | 8.50% | NA |
| III | 36 months | Monthly | 8.70% | 1,000 | 9.05% | NA |
| IV | 36 months | Annual | 9.05% | 1,000 | 9.04% | NA |
| V | 36 months | Cumulative | NA | 1,297.15 | 9.05% | NA |
| VI | 60 months | Monthly | 9.15% | 1,000 | 9.54% | NA |
| VII | 60 months | Annual | 9.55% | 1,000 | 9.54% | NA |
| VIII | 60 months | Cumulative | NA | 1,578.25 | 9.55% | NA |
| IX | 120 months | Monthly | 9.30% | 1,000 | 9.70% | NA |
| X | 120 months | Annual | 9.70% | 1,000 | 9.69% | NA |
STRENGTHS OF THE EDELWEISS HOUSING FINANCE NCD IPO:
- The company’s biggest strength is that the company has adequate capitalization that has been supported by Multiple Capital raises. The company in the past has also exhibited the ability to raise capital of more than Rs. 3,700 Crores in last 24 months through various Global Finance and Assets Management Company.
- Edelweiss Group is a diversified financial services player. The company has exhibited the ability to build a great market presence in different business operations. The company’s portfolio has increased by adding Asset Management, General Insurance, Wealth Management, Retail Finance, Life Insurance, Asset Reconstruction, broking and investment banking.
- The company has a wide range of access to cost-effective funding sources. Their funding requirements have been carried out through credit facilities from banks, issuing of Redeemable NCD and NHB through public issues.
- Edelweiss Housing Finance Limited carries out an Effective Use of Technology and Business and Data Analytics with the Credit Bureau. The company has a very robust loan management system and an analytic ability. The extensive usage of the allied KYC procedures and the credit provides a competitive advantage to the company.
- The company uses business and data insights that help them carry out a real-time analysis and the data capture and computation of income. The company has greatly benefitted from its management and data analysis system as per the monthly analytics reports for efficient risk management and control & compliance.
WEAKNESS AND THREATS OF EDELWEISS HOUSING FINANCE NCD IPO:
- Asset Quality of the company is in a very vulnerable condition. Though the company registered an increase in the overall stage III asset ratio, it also registered a deterioration in asset quality.
- Edelweiss Housing Finance Limited has been badly impacted on the front of the retail segment due to the pandemic.
- The company has Lower profitability than its peers in the sector of its operation. The company’s profitability ratio has been low due to higher credit costs.
- Edelweiss Housing Finance Limited has registered a Moderation in Profitability indicators of their business operation in terms of the financial and operation matrix. In FY 2021, the company registered a profit after tax of Rs. 254 Crores which was majorly due to the one-time gain of Rs. 1,400 Crore by the sale of the company’s majority stake in the wealth management business.
- The company is also susceptible to slippages in the retail and wholesale segment in credit costs.
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NCD ALLOCATION RATIO:
| Category of the Allocation | NCD Allocation | NCD’s Reserved |
| Institutional Investors | 10% | 150,000 |
| Non-Institutional Investors | 10% | 150,000 |
| High Net worth Investors | 40% | 600,000 |
| Retail Investors | 40% | 600,000 |
| Total NCD’s | 100 % | 1,500,000 |
PROMOTERS OF THE COMPANY:
The promoters of the company are as follows:
- Edelweiss Financial Services Limited
- Edelweiss Rural & Corporate Services Limited
- Edelweiss Finance Company Limited
COMPANY FINANCIALS OF EDELWEISS HOUSING FINANCE NCD IPO :
| Particulars | For the year ending with the amount in Rs. as in Millions | ||||
| 31 March, 21 | 31 March, 20 | 31 March, 19 | |||
| Total Assets | 49,311 | 50,508.26 | 54,517.15 | ||
| Total Revenue | 5,510.54 | 6,073.90 | 6,658.95 | ||
| Profit After Tax | 37.29 | 15.55 | 624.59 |
ISSUE RATING:
The NCD issue of the Edelweiss Housing Finance Limited is rated AA- along with a negative outlook as per the CRISIL rating. The NCD has been viewed as per the objective of the competition in an industry and the sector’s business environment, which is still uncertain. Also, the COVID-19 pandemic has greatly influenced the company’s business with a negative impact. During the period, the balance sheet size of the company has shrunk, which signifies the lack of appropriate financial performance of the company and sustainability of the company’s economic growth. The company’s business relies heavily on its loan book, so the quality of the loan book is critical.
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COMPANY CONTACT INFORMATION:
Edelweiss Housing Finance Limited
Tower 3, 5th Floor, Wing B,
Kohinoor City Mall Kohinoor City,
Kirol Road, Kurla (West) Mumbai 400070
Phone: +91 22 4272 2200
Email: investorgrievances@edelweisshousingfin.com
Website: https://www.edelweisshousingfin.com/
EDELWEISS HOUSING FINANCE NCD APR 2022 REGISTRAR:
KFintech Private Limited
KFintech, Tower-B, Plot No 31 & 32,
Financial District, Nanakramguda, Gachibowli,
Hyderabad, Telangana India – 500 032.
Phone: 04067162222, 04079611000
Email: ehfl.ncdipo@kfintech.com
Website: https://karisma.kfintech.com/
