Mahindra and Mahindra Financial Services is planning to raise equity capital worth Rs 2,000. According to the latest developments, the brand is taking several measures and exploring various ways for the fundraising, including a qualified institutional placement (QIP).
QIP is a capital raising tool that ensures the companies in the selling of equity shares, fully and partly convertible debentures or any securities excluding the warrants and can be converted into stocks.
Mahindra Finance is a Non-Banking Financial Company (NBFC) that enables auto loans essentially for purchasing tractors, utility vehicles and cars. Mahindra and Mahindra Ltd is India’s largest tractor and utility vehicle manufacturer brand that holds 51.2 per cent stake in the NBFC.
Reportedly, the company is in talking terms with several investment banks and are soon to hire a banker to avail advice on the fundraising.
“The fundraising will augment the NBFC’s capital base and help strengthen its balance sheet. The company has seen rise in its gross and net non-performing assets (NPA) and higher provisions for the same,” said sources.