Bajaj Finance raises Rs 2,500 crore through secured NCDs on private placement

In a significant fundraising move, Bajaj Finance Limited has raised Rs 2,500.20 crore through the allotment of secured redeemable non-convertible debentures, commonly known as NCDs, on a private placement basis. The company informed stock exchanges about the development under Regulation 30 of the SEBI Listing Obligations and Disclosure Requirements Regulations, 2015.

The decision was taken by the Debenture Allotment Committee of the company at its meeting held on 20 February 2026. The meeting began at 12:45 pm and concluded at 1:00 pm, during which the committee approved the allotment of 2,50,000 NCDs with a face value of Rs 1 lakh each.

This fundraising initiative reflects the company’s continued focus on strengthening its resource base to support future lending operations and business expansion.

Break-up of the NCD issue

The total issue has been divided into two separate options, each with different tenure and coupon rates.

Under Option I, the company allotted 1,00,000 NCDs of face value Rs 1 lakh each. This tranche aggregates to Rs 1,000.01 crore. These debentures carry a coupon rate of 7.40 percent per annum and have a tenure of 1116 days from the date of allotment. The maturity date for this tranche is 12 March 2029.

Under Option II, the company allotted 1,50,000 NCDs of face value Rs 1 lakh each. This portion aggregates to Rs 1,500.19 crore. These debentures carry a slightly higher coupon rate of 7.55 percent per annum and have a longer tenure of 1826 days. They will mature on 20 February 2031.

Together, both options amount to Rs 2,500.20 crore.

Interest payment schedule

Both tranches offer annual coupon payments.

For Option I, interest payments are scheduled on 12 March 2027, 12 March 2028, and 12 March 2029. The principal will be redeemed on maturity.

For Option II, interest payments are scheduled annually on 20 February 2027, 20 February 2028, 20 February 2029, 20 February 2030, and 20 February 2031, along with repayment of principal on maturity.

This structure ensures predictable annual cash outflow for the company while offering stable returns to investors.

Security and asset cover

The debentures are secured in nature, which provides an additional layer of comfort to investors. The repayment of principal, payment of interest, trustees’ remuneration and other related dues will be secured by a first pari passu charge on book debts and loan receivables of the company.

Importantly, the company has stated that the security cover shall not be less than one time the aggregate outstanding value of the debentures issued under this document. This means that the value of assets charged as security will be at least equal to the outstanding debenture amount.

Such security structures are common in corporate bond issuances and help improve investor confidence.

Listing details

The debentures are proposed to be listed on the Wholesale Debt Market Segment of BSE Limited. Listing on the debt segment enhances transparency and provides a trading platform for institutional investors.

The equity shares of the company are already listed on major stock exchanges, with BSE scrip code 500034 and NSE symbol BAJFINANCE – EQ.

What are NCDs and why companies use them

Non-convertible debentures are fixed income instruments issued by companies to raise long-term funds. Unlike convertible debentures, these instruments cannot be converted into equity shares. Investors receive fixed interest payments and principal at maturity.

Companies prefer NCDs as they offer flexibility in structuring tenure, coupon rates, and repayment schedules. For large non-banking financial companies, raising funds through NCDs is a regular part of liability management.

Private placement means that the securities are offered to select institutional investors rather than the general public. This route is quicker and often more cost-efficient than public issues.

Why this fundraising is important

Bajaj Finance is one of India’s leading non-banking financial companies. The company operates across consumer lending, SME finance, commercial lending, and rural lending segments. Raising funds through secured NCDs supports its lending growth, asset book expansion, and refinancing of existing liabilities.

In a competitive financial environment where interest rates and liquidity conditions fluctuate, locking in funding at coupon rates of 7.40 percent and 7.55 percent could be strategically beneficial.

The longer tenure Option II at 7.55 percent suggests that investors demanded slightly higher returns for extended maturity, which is typical in bond markets.

Impact on cost of borrowing

The coupon rates offered in this issue reflect prevailing market conditions. For a company of Bajaj Finance’s credit profile, raising long-term secured funds at sub-8 percent rates indicates stable investor confidence.

Borrowing costs are critical for non-banking finance companies. Since they lend money at higher interest rates, maintaining a balanced cost of funds ensures healthy net interest margins.

By diversifying funding sources between bank loans, bonds, and other instruments, the company reduces dependence on any single channel.

No default or delay reported

The disclosure also clarifies that there has been no delay in payment of interest or principal for more than three months from due dates, and no default has been reported. There are also no special rights or privileges attached to these instruments.

This clean compliance record is important for maintaining investor trust.

Corporate governance and transparency

The intimation was sent to both BSE and NSE, addressed to the respective listing departments. The formal communication highlights adherence to regulatory requirements.

The registered office of the company is located at C o Bajaj Auto Limited Complex, Mumbai Pune Road, Akurdi, Pune. The corporate office operates from Viman Nagar, Pune.

Regular and timely disclosures under SEBI regulations demonstrate corporate governance discipline.

Market perspective

India’s corporate bond market has seen steady activity in recent years. Large NBFCs often tap the private placement route to raise substantial funds quickly. Institutional investors such as mutual funds, insurance companies, and pension funds typically participate in such issues.

The structured security cover, fixed annual coupon, and clear maturity timelines make such instruments suitable for conservative institutional portfolios.

Future outlook

The Rs 2,500 crore fundraising is expected to strengthen Bajaj Finance’s balance sheet and liquidity position. With growing demand in retail and SME credit markets, maintaining strong funding lines remains essential.

The company’s diversified portfolio and wide geographic reach require continuous capital support. Raising funds through secured NCDs aligns with prudent financial management.

Going forward, investors will monitor how effectively the company deploys these funds and maintains asset quality.

Conclusion

The allotment of secured redeemable NCDs worth Rs 2,500.20 crore marks another milestone in Bajaj Finance’s funding strategy. Divided into two options with tenures extending up to 2031, the issue offers annual coupon payments and robust security cover.

The move reflects strong institutional appetite for quality NBFC debt and underscores the company’s steady access to capital markets.

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