PNB Housing Finance Eyes Debt-Market Fundraise Through NCD Issue

PNB Housing Finance will consider raising funds through non-convertible debentures (NCDs) when its board meets on 7 September. The housing finance company disclosed the proposed fundraise in a stock exchange filing on Monday.

The NCDs, if approved, will be issued through a private placement. This means the securities will be offered to a select set of investors rather than being made available to the public. The company has not yet specified how much it intends to raise.

PNB Housing Finance To Evaluate Fundraising Proposal

At its 7 September meeting, the board will consider the proposed issue and decide whether to approve and authorise the fundraise.

PNB Housing Finance said the proposed borrowing will remain within the overall limits approved by shareholders at the company's 38th Annual General Meeting.

The company has not disclosed the proposed size of the NCD issue or other terms at this stage. Details such as the interest rate, tenure and maturity of the securities are likely to be finalised if the board gives the fundraising plan the go-ahead.

What Are NCDs?

For companies, NCDs are one of the ways to borrow from investors. The investor receives interest on the amount invested, while the principal is returned at the end of the agreed tenure.

The “non-convertible” part means these debentures cannot be turned into shares of the company. They remain a debt investment until maturity, unlike convertible debentures, which may carry a conversion option.

For PNB Housing Finance, the proposed issue would provide another avenue to raise funds through the debt market. However, the company has not yet indicated how the proceeds would be deployed.

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