16% IRR Real Estate NCD - Maniveera Structure (SOLD OUT)

Opportunity Summary

High returns fixed income investment opportunity in Senior Secured Non-Convertible Debentures of INR ~30 Cr, issued by Maniveera Structure Private Ltd (99.9% subsidiary of Jain Heights and Structures Private Limited) - Managed by Dalmia Nisus Fund. 

Key Terms-

Issuer Name

M/s Maniveera Structure Private Ltd (99.99% subsidiary of Jain Heights and Structures Pvt. Ltd.)

Development Manager

Shriram Properties Ltd. is the Development Manager, the project is co-branded as “Shriram Rainforest” and has sold 70% of the inventory in project.

Co-investor

Due diligence and co-investment by Dalmia Nisus Fund (SEBI registered Category 2 AIF)

Coupon

17.00% per annum, compounded monthly and payable monthly

Pricing

Debentures are being offered at 2% premium to Face value.

Returns 16% IRR at maturity
Tenure NCDs are maturing on 31st October 2023
Security Property value cover of 1.9x
Principal repayment Principal shall be repaid in 4 equal quarterly Instalments from the end of 31-01-2023, 30-04-2023, 31-07-2023 and 31-10-2023
Principal Pre-Payment Allowed with notice period of 15 days, which may lower your final XIRR
Interest payment Payable at the end of each month in respect of the outstanding amount as at the beginning of the respective month
Face value INR 10,00,000
Minimum Investment amount approx. INR 10.3 lakhs. Exact amount based on payment date. 

Cut-off date for investing 15th Feb 2022

 

About the project-

  • Shriram Properties Ltd. is the Development Manager, the project is co-branded as “Shriram Rainforest” and has sold 70% of the inventory in project
  • Shriram Rainforest” is a plotted development project admeasuring ~28 acres offering 298 plots being developed by Maniveera Structure Pvt Ltd located at Chapparkallu Rd, Devanahalli, Bengaluru. Project is a modern gated community having a total saleable area of ~6.3 Lakh sq.ft in a single phase and will have all modern amenities like Gymnasium, Children Play Area, Party Lawn, Swimming Pool, Cricket pitch, Basketball Court, Lawn Tennis court, Badminton Court, etc.
  • Project started in April of 2018 and is completed and the project has already received final BIAAPA approval and release order

Positives-

  • Good IRR of ~16% for a highly secured instrument
  • Coupon is payable on a monthly basis
  • Property value cover of 1.9x. In addition, pledge of shares, Personal Guarantee and escrow(managed by Shriram Properties)
  • Shriram Properties is the development manager
  • Dalmia Nisus is a SEBI registered Category 2 AIF, a JV between Dalmia Cement promoters and Nisus Finance. It holds over 20 crores out of 30 crores of investment
  • Dalmia Nisus is monitoring the entire project
  • All the 3 founders of Multipie are investing in this deal

Risks and Mitigants -

  • Liquidity risk: Receivables from sold inventory are largely backed by Housing Finance Companies and bank mortgages. The balance receivables of sold inventory are being collected rapidly upon registration and handover of each units to the buyer. The investment has got free cash flow cover of 2.1x and minimum Asset cover of 1.90x.
  • Viability risk: Shriram Properties Ltd. Has sold 70% of inventory in project. Since the residual project cost is fixed, the viability of the project and its cash flow cover is nearly certain for handover of the units
  • Approval risk: The project has all approvals in place and has received final completion certificate/Occupation certificate. Hence there is no approval risk in the project

Collaterals-

  • Underlying Project Land, All Receivables, WIP, Development Rights, FSI etc on project “Shriram Rainforest”.
  • 100% Pledge of Shares of the Issuer
  • SPL Undertaking
  • Post Dated Cheques of interest & principal amount
  • Personal Guarantee of Promoter – Mr. Kishor Jain & Mrs. Rekha Jain
  • Company Guarantee of Holding Company Jain Heights Structures Private Limited

About Dalmia Nisus Finance Investment Managers LLP-

  • Dalmis Nisus is the joint venture fund of Nisus Finance headed by industry veteran Amit Goenka and Dalmia Group headed by Gaurav Dalmia
  • 230+ man years of combined real estate investment experience.
  • Dalmia Group Holdings & Nisus Finance services Co pvt ltd already have managed ~US$ 200 Mn. of real estate investment and transacted US$500 Mn of assets

Click here for detailed information

For any queries, please drop a mail at [email protected]

Disclaimer-Multipie is only a facilitator of this opportunity and does not guarantee any repayment or scheduled payment for the mentioned instrument.

 

FAQs

1.What is the process to invest?
It's quite simple.
i. Once you give your interest in the investment opportunity, you'll need to email the KYC documents to investment manager Nisus.
ii. Nisus will confirm the receipt of documents and provide the bank account details where you'll need to transfer the investment amount
iii. Once the transfer is confirmed, Nisus will credit the debentures in your demat account in T+5 business days.


2.What is the significance face value of debenture? Why is my investment amount different from face value?
Face value is the investment value of the bond when it is first issued. The face value of the NCD is the amount on which interest is calculated. Investment amount is different from the face value as the debenture is purchased at the current market price.

3.Where and when will be the debenture get credited after investment?
The debenture will get credited within 5 business days in your demat account that you had provided at the time of registration

4.What is source of fund for repayment of investment?
Your investment will be repaid from the cashflow being generated from the sale of flats in the project. Since the project is nearing completion, the sales and cashflows realization risk has been largely mitigated.

5.What is Premium?
When a bond is trading above its original price (face value) in the market, premium is the additional amount paid over the face value of the bond.

6.How are my returns impacted if the borrower repays early?
Any form of prepayment is a good sign as this indicates that project is performing better than expected however pre-payment will reduce the returns.

7.Do I have an option to exit my investment before the maturity date?
No, As this is a fixed tenure debt instrument, the investor will have to remain invested till maturity. However, there is possibility of prepayment from project cashflow (based on underlying project progress) and resulting in exit prior to the maturity date.

8.Will there be TDS deduction by the borrower on pay-outs?
Yes, TDS is applicable on the interest portion of any pay-outs that is made. The applicable TDS will be deducted at source by the borrower. The TDS amount deducted will automatically reflect in your form 26AS.

9.What happens in case of default?
In case of default, investors in the debenture (Multipie investors as well as Dalmia Nisus) will have access to collections in escrow account. The advantage of investing along with an investor like Dalmia Nisus is access to their recovery and legal system.

10.What is role of Multipie?
Multipie is evaluating the opportunity and selecting it for investors on Multipie.

11.Is this NCD rated?
This is not a rated NCD.

12.What is IRR?
It is the annualised rate that the investment in debenture is expected to generate.

13.What is secured NCD? How is it different from unsecured?
Secured NCD are where borrower puts up some asset as surety or collateral for the loan. A secured debt instrument simply means that in the event of default, the lender can use the asset to repay the funds it has advanced the borrower. Unsecured NCD has no collateral backing. It requires no security, as the name implies.

14.What is the tax levied?
Interest Income on NCD is taxed under the head "Income from Other Sources" at applicable tax slabs.

15.Who is the development manager?
Shriram Properties is the development manager.

16.Can I sell the instrument before maturity?
In situations of liquidity requirement, Multipie will make best efforts to help sell at the prevailing market price.

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