Poonawalla Fincorp has announced that its Finance Committee, as authorized by the Board of Directors, has approved the issuance of non-convertible debentures (NCDs) worth ₹750.00 crore. The approval was granted for secured, redeemable, rated, listed NCDs with a face value of ₹1,00,000 each, to be issued through private placement in dematerialized form.

NCD Issuance Structure

The debenture issuance has been structured under the PFL NCD Series II FY 2025-26 with a comprehensive framework to provide flexibility in fundraising. The following table outlines the key components of the NCD structure:

Security and Payment Terms

The NCDs come with robust security features and defined payment structures. The obligations under the debentures will be secured by way of first ranking pari passu charge on the hypothecated properties, which is sufficient to provide the required security cover until the redemption date.

In case of any delay in payment of interest or principal amount, the company will pay a coupon on the NCDs at a rate of 2.00% over and above the applicable coupon rate for any delay in payment until such event of default is cured to the satisfaction of the Debenture Trustee.

Regulatory Compliance and Documentation

The issuance has been disclosed under Regulation 30 and 51 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The schedule of payment of coupon, interest and principal, along with the date of allotment and redemption, will be specified in the key information document.

The private placement approach allows the company to directly approach eligible institutional investors, providing greater flexibility in structuring the debentures according to investor preferences. The green shoe option provides additional flexibility to optimize fundraising based on market conditions and investor demand.

Poonawalla Fincorp has received a significant credit rating boost from CRISIL Ratings Limited, which assigned its highest AAA/Stable rating to the company's ₹10,000 crore Non-Convertible Debentures on December 12, 2025. The rating agency also enhanced the company's total bank loan facilities rating to ₹15,285 crore from the previous ₹12,285 crore, while reaffirming existing ratings across various debt instruments.

Rating Action and Instrument Details

CRISIL's comprehensive rating action covers multiple debt instruments and facilities. The rating agency assigned the AAA/Stable rating to ₹10,000 crore of new Non-Convertible Debentures while reaffirming ratings on existing instruments.

Strong Promoter Support Framework

The ratings are anchored by the expectation of need-based timely support from Rising Sun Holdings Private Limited (RSHPL), which holds a 63.96% stake in Poonawalla Fincorp as of September 30, 2025. RSHPL is an investment holding company owned and controlled by Mr. Adar Poonawalla, with the promoter group's flagship company being Serum Institute of India Private Limited (SIIPL), rated CRISIL AAA/Stable/CRISIL A1.

SIIPL infused approximately ₹6,782 crore through compulsorily convertible cumulative preference shares in RSHPL till March 31, 2025. The rating agency notes RSHPL's commitment to maintain majority shareholding in Poonawalla Fincorp, retain management control, and provide equity capital support for growth when required.

Financial Performance and Capitalization

Poonawalla Fincorp demonstrated robust financial metrics as of September 30, 2025. The company's net worth stood at ₹9,822 crore, improved from ₹8,124 crore as of March 31, 2025, following equity infusion of around ₹1,500 crore from RSHPL through preferential issue in September 2025.

Asset Quality and Business Growth

The company maintained comfortable asset quality metrics with Gross Non-Performing Assets (GNPA) improving to 1.59% as of September 30, 2025, from 1.84% as of March 31, 2025. Net NPA also improved to 0.81% from 0.85% during the same period. Assets under management grew by 43% year-on-year in fiscal 2025 and thereafter by 68% annualized in the first half of fiscal 2026 to ₹47,701 crore as of September 30, 2025.

The company's portfolio consists primarily of retail and MSME products with a secured and unsecured mix of 56:44 for on-book portfolio as of September 30, 2025. Poonawalla Fincorp is focusing on newer segments including gold loans, consumer durable loans, prime personal loans, shopkeeper loans, education loans, and used commercial vehicle financing.

Diversified Funding Profile

As of September 30, 2025, the company maintained a diversified funding mix with total borrowings of ₹35,717 crore. The funding composition included term loans (44%), followed by NCDs (26%), commercial paper (10%), CC/WCDL line (10%), ECB (8%), and remaining through subordinated debt, perpetual debt and others. During the first half of fiscal 2026, Poonawalla Fincorp raised ₹29,871 crore gross from diversified sources, with weighted average cost of borrowings at 7.69% as of September 30, 2025.

Outlook and Key Monitorables

CRISIL maintains a stable outlook, factoring in the expectation of need-based timely support from RSHPL. The rating agency will monitor the sustainability of the company's earnings profile and performance of asset quality across asset classes, including newer segments, given the limited portfolio seasoning. The company's ability to manage operating expenses and credit costs while scaling up operations remains a key focus area for rating stability.