Motilal Oswal Financial Services has announced its intention to raise up to Rs 1,000 crore through a public issue of non-convertible debentures (NCDs).

The company aims to achieve this fundraising target by issuing Secured Redeemable Non-Convertible Debentures with a face value of Rs 1,000 each. The issuance comprises a Base Issue Size of up to Rs 500 crore, with an additional green shoe option of up to Rs 500 crore, thereby cumulatively aggregating to Rs 1,000 crore.

The NCDs will be offered in eight series, each carrying fixed coupons and varying tenures of 24 months, 36 months, 60 months, and 120 months. Investors will have the flexibility to choose from annual, monthly, and at maturity interest payment options. Motilal Oswal Financial Services disclosed in a regulatory filing that the effective annual yield for the NCDs ranges from 8.85 per cent to 9.70 per cent per annum.

The utilisation of funds raised through this issuance is earmarked primarily for meeting working capital requirements and repayment of existing liabilities, with at least 75 per cent of the proceeds allocated for these purposes. The remaining balance will be utilised for general corporate purposes, as stated by the company.

The move by Motilal Oswal Financial Services reflects its strategic approach to capital management and highlights its confidence in the market environment. The issuance of NCDs provides the company with an avenue to raise funds at competitive interest rates while diversifying its funding sources.

(With PTI inputs)