IKF Finance Ltd, a Vijaywada-based small-sized commercial vehicle finance firm, is looking to raise around $2 million through a preferential issue of convertible debentures and equity convertible warrants to a group of investors including promoters.
The company is looking to offer 5.47 million fully convertible debentures (FCDs) and 1.6 million warrants to resident and non-resident Indians, including promoters, at a premium arrived in accordance with the SEBI guidelines, it stated on Monday.
The scrip of the small cap firm declined 4.5 per cent after the announcement that came along with its financial results. IKF Finance shares are trading at Rs 13.35 and if the securities are issued based on this price, the firm will be able to raise around Rs 9.4 crore or a little over $2 million through an equity dilution of around 37 per cent, considering the securities are fully converted.
IKF Finance largely has a presence in southern India and offers auto loans, besides working capital finance. In the last financial year, it opened around 10 new branch offices in Tamil Nadu (Tirunelveli, Vellore and Salem), Karnataka (Mangalore, Gulbarga and Hospet), Andhra Pradesh (Nirmal, Mancherial and Srikakulam) and Pondicherry to increase the total number of branch and satellite offices to 49.
The company also has an association with HDFC Bank (joint-lending arrangement) and Sundaram Finance (securitisation).
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