Shivam Autotech Limited, a prominent company in India, has recently announced its decision to raise funds through the issuance of secured, unrated, redeemable Non-Convertible Debentures (NCDs). This move, aimed at raising up to ₹50 crore, marks a significant step in the company’s growth strategy. The private placement of these NCDs will offer a unique opportunity for investors to invest in a secured instrument with an attractive return rate. The company has indicated that the NCDs will have a face value of ₹1,00,000 each, and a total of 5000 NCDs may be issued, making this an appealing investment opportunity for individuals and institutions alike.

The tenure for these NCDs will extend up to a maximum of 48 months, with a 12-month moratorium. The interest rate on these NCDs is set at 14% per annum, making them a lucrative option for fixed-income investors. The interest will be paid in line with the terms outlined in the transaction documents, and the principal redemption will occur according to the schedule established by the debenture trust deed. This plan for NCD issuance is in compliance with applicable SEBI regulations and the necessary listing requirements.

Shivam Autotech has also detailed the security associated with the NCDs. These securities will be backed by assets provided against YES Bank Limited facilities at the company’s Rohtak plant. Furthermore, a Debt Service Reserve Account (DSRA) will be maintained to ensure smooth interest servicing for at least one quarter, offering added security for investors. The company will also provide a second charge on all fixed assets, making these NCDs a relatively secure investment.

In terms of the special rights and privileges attached to the instrument, these will be governed by the debenture trust deed, which will outline the terms and conditions agreed upon by both the company and the subscribers of the NCDs. The rights and obligations of both parties will be carefully structured to ensure mutual benefits and proper risk management.

Moreover, the company has not reported any default or delay in the payment of interest or principal amounts on any of its financial instruments, ensuring that these NCDs are issued with a track record of financial responsibility.

Shivam Autotech's decision to raise funds through the issuance of secured NCDs reflects the company’s confidence in its financial stability and future growth prospects. The private placement approach allows the company to raise capital efficiently without the need for a public offering. This method of fundraising also ensures that the company can maintain control over the process while offering investors an opportunity to participate in the company’s success.

For those interested in investing in the Indian market, this is a noteworthy development, and Shivam Autotech’s decision could signal more such fundraising moves from other companies in the near future. Investors seeking to explore the potential of NCD investments or looking for high-interest secured financial instruments may find this offering appealing.

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