UGRO Capital , a non-banking finance company (NBFC), has announced plans to issue non-convertible debentures (NCDs) to raise funds and bolster its capital adequacy. The company's Investment and Borrowing Committee has approved the issuance of unsecured, rated, subordinated, listed, taxable, redeemable NCDs through a private placement.

Issue Details

Purpose and Implications

The NCD issue is designed to raise subordinated debt as Tier II capital, aimed at enhancing UGRO Capital's capital adequacy. This move aligns with the Reserve Bank of India's (RBI) Master Direction for Non-Banking Financial Company – Scale Based Regulation Directions, 2023.

Key Features of the NCDs

• Security: The NCDs will be unsecured.
• Interest Payment: Interest is payable on a monthly basis.
• Redemption: The principal amount will be redeemed on the maturity date.
• Default Interest: In case of delayed payments, an additional interest of up to 2.00% per annum may be applicable.

Investor Considerations

Potential investors should note that these NCDs are subordinated, which typically implies a higher risk profile compared to senior debt. However, the higher indicative coupon rate of 11.65% p.a. may be attractive to those seeking higher yields and willing to accept the associated risks.

UGRO Capital's decision to issue NCDs comes at a time when NBFCs are increasingly looking to diversify their funding sources and strengthen their capital base. The success of this issue could provide insights into investor appetite for NBFC debt instruments in the current market environment.

As always, investors are advised to carefully review the terms and conditions of the issue and consider their risk appetite before making investment decisions.

UGRO Capital Limited, a prominent player in the financial services sector, has successfully raised INR 150 crore through the allotment of non-convertible debentures (NCDs) via private placement. This strategic move, executed on October 17, 2025, marks a significant step in the company's financial operations.

Key Details of the NCD Issuance

Security and Redemption

UGRO Capital has committed to maintaining a minimum security cover of 1.10 times over loan receivables throughout the tenure of the debentures. This provision aims to safeguard the interests of the debenture holders. The NCDs are set to be redeemed at par value upon maturity.

Significance of the Move

This successful fund-raising initiative through NCDs demonstrates UGRO Capital's ability to tap into debt markets effectively. The funds raised may potentially be utilized for various purposes such as expanding lending activities, refinancing existing debt, or supporting overall business growth.

Regulatory Compliance

The company has adhered to the necessary regulatory requirements, including informing the stock exchanges as per SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. This transparency in financial activities is crucial for maintaining investor confidence and regulatory compliance.

UGRO Capital's strategic decision to issue NCDs comes at a time when companies are exploring diverse funding avenues. This move may be seen as part of the company's broader financial strategy to optimize its capital structure and support its business objectives in the dynamic financial services landscape.