8.5% IRR Senior Secured Debenture

debenture

Issuer Name MAS FINANCIAL SERVICES LIMITED
Issuer Rating [ICRA]A (Stable)
ISIN INE348L07084
MLD Rating CARE PP-MLD A+ 
Listed on 25-Jun-2021
Maturity date 23-Dec-2023
Debenture Trustee Catalyst Trusteeship Limited
Yield  8.5% p.a.
Security class NCD
Listed on BSE
Face Value  INR 100,000
Security Cover of 1.10x of the value of the outstanding principal amount

 

About MAS Financial Services Limited (MFSL)

MAS Financial Services Limited (MFSL) gives loans to the mid and low income group segments. It is having more than more than 25+ yrs of experience. Debt to Equity is 3.3(as of Sep'21) and net NPA ratio is 1.46(as of Mar'21). It is supported by instituional investors like Motilal Private Equity, Axis Mutual Fund Trustee Limited , IDFC Mutual Fund, TATA AIA Life Insurance Company, ASK Investment Managers, Schrolders Intl Selection Fund India Opportunties. It is providing senior secured instrument with low maturity period.

Positives
  • Rated A+ by CARE
  • Strong financials of the issuer with Capital Adequacy Ratio of 26.85% as on 31st March,21.
  • Secured NCD
Risks
Issuer, being an NBFC, is susceptible to-
  • Deterioration in loan book quality
  • Asset Liability mismatch

Click here for Information Memorandum

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

FAQs

What is the objective of this issue?

The proceeds of the proposed MLD issue by MAS Financial Services shall be utilized for the following purposes:

  • General corporate purposes
  • For the ordinary course of business of MFSL, including repayment/refinancing of existing debt

What does MAS Financial Services do?

MAS Financial Services Limited (MFSL) gives loans to the mid and low income group segments. It is having more than more than 25+ yrs of experience. Debt to Equity is 3.3(as of Sep'21) and net NPA ratio is 1.46(as of Mar'21). It is supported by instituional investors like Motilal Private Equity, Axis Mutual Fund Trustee Limited , IDFC Mutual Fund, TATA AIA Life Insurance Company, ASK Investment Managers, Schrolders Intl Selection Fund India Opportunties. It is providing senior secured instrument with low maturity period.

What is the rating of the issuer?

Rated A(Stable) by ICRA

What is the market cap of the issuer?

INR 3,278 Cr

Who are the promoters?

Mr. Kamlesh Gandhi, Mr. Mukesh Gandhi

What is the process to invest?

It's quite simple.

  • Once you give your interest in the investment opporunity, our team will contact you for further process.
  • We'll let you know the timing when the order will need to be placed on the exchange
  • You will need to ensure sufficient balance in your demat account for order execution

What is the debt to equity ratio of MAS?

3.3 as on Sept 21

What is the NPA ratio of MAS?

Gross NPA 1.86% & Net NPA 1.46% as on March 21

For how long has MAS been in this business?

MAS Financial Services commenced business in 1988, 25+ Years

Who are the instituional investors in shares of MAS?

Motilal Private Equity, Axis Mutual Fund Trustee Limited , IDFC Mutual Fund, TATA AIA Life Insurance Company, ASK Investment Managers, Schrolders Intl Selection Fund India Opportunties

Does MAS have any history of defaults since its inception?

No (Inception 1988)

What is the security of the paper?

A security cover of 1.10x of the value of the outstanding principal amount of the MLDs shall always be maintained until the redemption of the MLDs.

Is the instrument listed?

Yes, BSE

Who is the trustee?

Catalyst Trusteeship Limited

What is the liqudity of the instrument?

In situations of liquidity requirement, Multipie will make best efforts to help sell at the prevailing market price.

What is role of Multipie?

Multipie is evaluating the opportunity and selecting it for investors on Multipie.

What is the significance face value of debenture? Why is my investment amout 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 purcahsed at the current market price.

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 (~25-70 bps).

Will there be TDS deduction by the borrower on payouts?

Yes, TDS is applicable on the interest portion of any payouts 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.

What is IRR?

It is the annaulised rate that the investment in debenture is expected to generate.

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.

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.

What is the tax levied?

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

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.

What is MLD?

Market-linked debentures are debt securities linked to market performance, due to which they enjoy equity taxation.

What is senior secured bond?

A senior secured bond is a bond that is backed by a security pool. Incase of a bankruptcy event, bond holders will depend on this security pool to get their investment back after the liquidation proceedings.

 

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