Navi Finserv Limited is a non-deposit taking, systemically important NBFC registered with RBI and a wholly owned subsidiary of NTL. NTL is a technology-driven financial products and services company in India focusing on the digitally connected young middle-class population of India. The Company offers lending products like personal loans and home loans under the 'Navi' brand. They launched the personal loans product under the 'Navi' brand in April 2020. Under this business, they extend instant personal loans up to Rs 2.0 million with tenors of up to 84 months as permissible under internal policies of the Company through an entirely digital Navi App-only process. Since the launch and up to September 30, 2023, they have disbursed 3,671,272 personal loans amounting to Rs 215,321.33 million. During the six months period ended September 30, 2023, they disbursed 1,010,761 personal loans amounting to Rs 61,361.45 million, with an average ticket size of Rs 60,708. From the date of the launch, they have approved personal loans to customers across over 99.69% of all Indian pin codes. As of September 30, 2023, the Company’s personal loans business had an AUM of Rs 67,635.81 million. The Company’s home loans product was launched under the “Navi” brand in February 2021 to extend: (a) home loans for ready to move-in, under-construction and self-constructed properties, and (b)loans against property for constructed properties. As of March 31, 2023, the Company had disbursed home loans across 10 cities in India. The Company offers loans up to Rs 100 million with a tenor of up to 40 years. As of September 30, 2023, the Company had an AUM of Rs 7,257.62 million and since launch they have disbursed loans amounting to Rs 11,785.56 million with an average ticket size of Rs 6.24 million during the six months period ended September 30, 2023. As on September 30, 2023, they had CRAR of 25.56% in the Company which is higher than statutory minimum CRAR of 15.00% as prescribed by RBI. The Company’s long-term debt is rated IND A (Stable) and CRISIL A (Stable) by India Ratings and CRISIL, respectively, and commercial papers are rated Ind A1 by India Ratings and A1 by CARE. The Company’s total borrowings, on a standalone basis, as at December 31, 2023, March 31, 2023 and March 31, 2022 amounted to Rs 63,415.96 million, Rs 57,626.32 million and Rs 27,879.76 million, respectively. They rely on long-term, medium-term borrowings and short term borrowings from various sources. They take term loans, issue non-convertible debentures, market-linked debentures, and commercial papers. They have a diversified lender base comprising public sector undertakings ('PSUs'), private banks, mutual funds, and others. They also securitise parts of the portfolios by way of pass through certificates ('PTCs') and direct assignments ('Direct Assignments') of loan receivables to various banks or NBFCs. They also extend personal loans through co-lending partnerships with financial institutions. This NCD is given rating of CRISIL A/Stable by CRISIL and the instruments with this rating are considered to have adequate degree of safety regarding timely servicing of financial obligations. Financial performance of company is improving and NPAs are in control. So, good rating and lucrative coupon rates make this offer an option for investors looking for long term fixed income. We give SUBSCRIBE rating to debt issue.
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