NewsMahindra & Mahindra Financial Services Approves NCD Issuance of Up to ₹3,000 Crore via Private PlacementMahindra & Mahindra Financial Services Approves NCD Issuance of Up to ₹3,000 Crore via Private Placement
Mahindra & Mahindra Financial Services' Debenture Issuance Committee approved the issuance of Secured, Rated, Floating, Listed, Redeemable NCDs (Series AC2026) up to ₹3,000 Crore on a private placement basis on 14th May 2026. The debentures carry a floating coupon of 3MTBILL+2.10% per annum, payable annually with quarterly reset, and are secured by an exclusive charge on receivables to the extent of 100% of debenture outstanding, with maturity on 18th May 2029.
*this image is generated using AI for illustrative purposes only.
The Debenture Issuance Committee of Mahindra & Mahindra Financial Services , as authorized by its Board of Directors, approved on 14th May 2026 the offer and issuance of Secured, Rated, Floating, Listed, Redeemable Non-convertible Debentures (NCDs) on a private placement basis. The approval falls within the overall borrowing limits sanctioned by the shareholders and the authorization granted by the Board. The issuance has been designated as Series AC2026 (Fresh Issuance) and is subject to applicable regulatory requirements under SEBI Listing Regulations.
Key Issuance Details
The following table summarizes the primary terms of the NCD issuance:
| Parameter: | Details |
|---|---|
| Type of Security: | Secured, Rated, Floating, Listed, Redeemable Non-convertible Debenture |
| Face Value: | ₹1,00,000/- per debenture |
| Type of Issuance: | Private Placement |
| Total Number of Debentures: | Up to 3,00,000 Non-Convertible Debentures |
| Issue Size: | Up to ₹3,000 Crore (Base issue ₹2,000 Crores with Green Shoe of additional ₹1,000 Crores) |
| Listing: | Wholesale Debt Market Segment of BSE Limited |
| Tenure: | 2 years & 364 Days (1095 Days) from the deemed date of Allotment |
| Date of Allotment: | 19th May 2026 |
| Date of Maturity: | 18th May 2029 |
| Pay-in Amount: | Based on the bid price(s) on the Electronic Bidding Platform |
| Coupon/Interest: | 3MTBILL+2.10% Spread p.a., payable annually, subject to quarterly reset |
Coupon Payment Schedule
The debentures carry a floating interest rate benchmarked to the 3-month T-Bill rate with a spread of 2.10% per annum, payable annually and subject to quarterly reset. The following table illustrates the indicative cash flow schedule based on the initial coupon rate. The actual interest amounts will be determined based on the reset mechanism, given the floating nature of the instrument.
| Cash Flows: | Date | No. of Days in Coupon Period | Amount per Debenture (₹) |
|---|---|---|---|
| 1st Coupon: | Wednesday, 19 May, 2027 | 365 | 7,380.00 |
| 2nd Coupon: | Friday, 19 May, 2028 | 366 | 7,380.00 |
| 3rd Coupon: | Friday, 18 May, 2029 | 364 | 7,359.78 |
The above cash flow is only an illustration as per the initial coupon rate. Actual interest rates will be determined based on the reset mechanism.
Security and Redemption Terms
The debentures will be secured by way of an exclusive charge in favour of the Debenture Trustee on present and/or future receivables under Loan contracts/Hire Purchase/Lease, owned assets, and book debts to the extent of 100% of the debenture outstanding. The security will be created on assets that are free from any encumbrances, and the company will establish appropriate security in favour of the debenture trustee within the timeframe prescribed under applicable law.
The redemption details are as follows:
| Parameter: | Details |
|---|---|
| Redemption Date: | 18th May, 2029 |
| Redemption Amount: | ₹1,00,000/- per debenture |
In the event of a default in payment of coupon and/or principal redemption on due dates, additional interest at 2% per annum over the coupon rate will be payable by the company for the defaulting period. No special rights, privileges, or interests are attached to the instruments, and there are no pending cancellations or terminations of the issuance proposal.
Source: None/Company/INE774D01024/d9cca550a8804be8.pdf
Historical Stock Returns for M&M Financial Services
| 1 Day | 5 Days | 1 Month | 6 Months | 1 Year | 5 Years |
|---|---|---|---|---|---|
| +0.23% | -2.07% | +8.35% | +4.21% | +23.88% | +118.85% |
How might fluctuations in the 3-month T-Bill rate over the next three years impact Mahindra Finance's effective borrowing cost relative to fixed-rate alternatives in the current interest rate environment?
Will Mahindra Finance pursue additional NCD tranches or diversify its funding mix through other instruments given its overall borrowing limits, and what does this signal about its near-term loan book expansion plans?
How could a potential RBI rate cycle shift — either easing or tightening — affect investor appetite for floating-rate NCDs like Series AC2026 compared to fixed-rate debt instruments in the wholesale debt market?
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