Arman Financial subsidiary raises Rs 66.3 crore of debt

Arman Financial Services Ltd, a leading Gujarat-based non-banking financial company (NBFC), announced that its wholly-owned subsidiary-Namra Finance Ltd, which manages the microfinance business of the group, raised Rs 66.3 crore of debt capital from Micro Units Development and Refinance Agency (MUDRA) and IIV Mikrofinanzfonds, Germany (external commercial borrowing).

NBFC raised Rs 25 crore from MUDRA at 6.4 per cent rate of interest on March 17, 2020, for a tenure of two years and another Rs 41.13 crore from IIV Mikrofinanzfonds, Germany at 12.0 per cent rate of interest (inclusive of hedging cost) on March 16, 2020. This loan is fully-hedged and has a tenure of three years with a bullet repayment structure.

Speaking on the announcement, Jayendra Patel, Vice Chairman & Managing Director of Arman Financial Services stated that both these debt capital raising transactions from the company’s liability management standpoint have very positive developments, especially in the light of the current COVID-19 crisis. He further stated that with the conclusion of these transactions and the already existing reserves, Arman Financial Services have sufficient liquidity to manage the temporary closures related to COVID-19.

Arman Financial Services Limited is an asset finance company engaged in providing microfinance as well as financing the purchase of two and three-wheelers.

Despite the announcement, the stock of Arman Financial Services locked at its lower circuit of 10 per cent and thereby, trading was suspended at Rs 443.55 per share, down by 9.99 per cent or Rs 49.25 per share. The stock’s 52-week high is Rs 1,119.95 and the 52-week low is Rs 326.10 on BSE.