Muthoot Microfin Approves $15 Million Bonds and ₹150 Crore NCDs on Private Placement

Microlender Muthoot Microfin on Wednesday, September 3, announced fresh fundraising plans through the issuance of foreign currency bonds and domestic non-convertible debentures (NCDs). The move, approved by the company’s Debenture Issue and Allotment Committee, highlights its strategy to diversify funding sources and strengthen its capital structure.

$15 Million Bond Issue

The company will issue 1,500 secured, rated, listed, redeemable US dollar-denominated bonds, each with a face value of $10,000, aggregating $15 million. These bonds will be listed on NSE IFSC Limited.

The bonds carry a 36-month tenure, beginning from the deemed allotment date of September 15, 2025, and maturing on September 15, 2028. Coupon payments will be linked to the six-month CME Term SOFR plus 275 basis points, payable semi-annually. To secure the issuance, Muthoot Microfin will create a first-ranking exclusive hypothecation over identified receivables and eligible portfolio loans, maintaining a security cover of 1.05 times.

₹150 Crore NCDs in Two Tranches

Alongside the foreign currency bonds, Muthoot Microfin will raise up to ₹150 crore through NCDs, split into two tranches.

• First Tranche: The company will issue up to 5,000 rated, unsubordinated, secured, listed, taxable, transferable, redeemable NCDs of ₹1 lakh each, aggregating ₹50 crore. These will be listed on the BSE with a tenure of 24 months starting September 18, 2025, and maturing on September 18, 2027. The coupon rate has been set at 9.80% per annum, payable monthly. Security will be maintained through a first-ranking exclusive charge on identified receivables, covering 1.1 times the outstanding debentures.
• Second Tranche: Muthoot Microfin will also issue up to 1,00,000 listed, rated, senior, secured, transferable, redeemable NCDs of ₹10,000 each, aggregating ₹100 crore. These instruments, also to be listed on the BSE, will carry the same 9.80% annual coupon payable monthly. With a 24-month tenure starting September 12, 2025, they will mature on September 12, 2027, backed by receivables with a security cover of 1.1 times.

The company confirmed that there are no delays or defaults in servicing its debt obligations, and the instruments carry no special rights or privileges.

Muthoot Microfin Share Price Performance

On September 3, 2025, Muthoot Microfin share price opened at ₹162.90 compared to the previous close of ₹160.32. The stock touched a low of ₹160.50 during the day and ended the session 5.01% higher at ₹168.35.

Read More: Muthoot Microfin launches first Assam branch, expanding to 21 states, enhancing financial inclusion in Northeast India

Conclusion

Muthoot Microfin’s decision to raise $15 million through dollar bonds and ₹150 crore via NCDs reflects its proactive funding strategy to support growth. By diversifying into both international and domestic markets, the company aims to strengthen its balance sheet, ensure liquidity, and maintain investor confidence while continuing to expand its microfinance lending base.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.