High Yield | A+/Stable Rated | Minimum Investment: 10k Only
Bond overview
InCred Financial Services Limited is issuing the Non-Convertible Debentures. These NCDs are A+/Stable rated by CRISIL. The NCDs are being issued in five series: coupon ranges from 9.48% to 10.30% p.a. and different tenures of 18 months, 24 months, and 36 months. The NCDs are secured and redeemable in nature.
Coupon rates and effective yield for each of the series
Allocation Ratio
The allocation ratio is prepared based on norms laid down by SEBI. Before announcing the allocation ratio, the same has to be approved by SEBI. Once the IPO subscription closes, applications will be divided into different categories. The category-wise allocation ratio is always decided and declared during the launch of the particular IPO. Considering the Allocation Ratio, units will be assigned to applicants. Refer to the chart to know the application ratio for InCred Financial Services Limited NCD-IPO.
Investment Process for InCred Financial Services Limited NCD IPO
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If the investment amount is less than & up to 10 lakhs, retail investors can apply for an IPO online.
If the investment amount is more than 10 Lakhs.
Financial Overview
Snapshot stating the Revenue, Expenses, PAT (In crores)
Cash flow for last 5 years (In crores)
Cash flow refers to the movement of cash in and out of the business at a specific point in time. It represents the net balance of the cash movement.
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- *Cash flow from operating activities reflects the amount a company generates through its product of services.
- **Cash flow from investing activities reflects cash generated and spent relating to investing activities, like purchase of assets, sales of securities etc.
- ***Cash flow from financing activities gives an insight into the financial stability of a company to its investors. It reflects the net flows of cash that are used to fund the company.
Ratio Analysis
Issue analysis
Pros
- The NCD is A+ rated security with a stable outlook.
- Incred Financial Services is offering coupon of up to 10.30% on its NCD IPO tranche. This is significantly higher than the interest rates offered on fixed deposits and other traditional investment options.
- Incred Financial Services is offering NCDs with a variety of tenures, ranging from 18 to 36 months. This gives investors the flexibility to choose a tenure that meets their individual needs.
Cons
- Decreasing Cash flows every year
- NCDs may not be as liquid as other investment options, such as stocks and fixed deposits. This means that it may be difficult to sell NCDs before they mature.
To get better returns than Bank FDs, invest in NCD-IPOs online.
About InCred Financial Services Limited
Incred Financial Services Ltd., which was originally incorporated in February 1995 as Multiflow Financial Services Pvt. Ltd. Previously known as KKR India Financial Services Ltd. began operations in February 2017 and has its headquarters in Mumbai, India.
Strengths
- Incred is a financially sound company with a strong net worth and low gearing. The company’s net worth improved from Rs 2,484 crore to Rs 2,548 crore between March 31, 2023 and June 30, 2023. Its gearing ratio, which measures the company’s debt levels relative to its equity, also improved from 1.6 times to 1.5 times during the same period. This indicates that Incred is well-capitalized and has a comfortable level of debt.
- Incred has an experienced management team with a proven track record. The company’s promoters and senior management team have a deep understanding of the Indian financial services industry and have a proven track record of success.
- Incred has a diversified loan portfolio that is growing rapidly. The company’s loan portfolio grew by 44% year-over-year to Rs 6,484 crore as on June 30, 2023. This growth was driven by the company’s growing retail personal loan and education loan portfolio.
Weakness
- Incred has high operating expenses because it is a new company and is still investing in its business. The company’s operating expenses include support costs, employee expenses, and technology-linked expenses.
- Incred’s loan portfolio is relatively new and has not yet been fully tested. This means that there is a risk that some of the loans in the portfolio may default. However, the company’s loan portfolio is diversified across multiple asset classes, which reduces the overall risk.
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Source – Prospectus October 11, 2023
Disclaimer – The information is published as on date 16/10/2023 based on information available on Prospectus October 11, 2023. The information may be subject to change in case of change in terms of prospectus or any other reason as the case maybe. Contents which are exclusively for educational information/knowledge sharing on capital market concepts and has no influence the investment/sale decisions of any investors
