Mahindra & Mahindra Financial Services Limited is preparing to raise Rs. 2,000 crore equity capital, said two persons aware of the matter. The company is exploring various routes for the proposed fund-raising, including a QIP (qualified institutional placement) and a private placement of shares with private equity investors. Mahindra finance has started discussion with investment banks and is expected to hire a banker soon to advise on the fund raise.
The company reported a 46 percent fall in net profit to Rs. 58.42 Cr in the QY FY 2017-18. The company had announced a net profit of Rs. 107.64 crore in the last fiscal, correspondingly.
M&M Financial Services had a network of 1183 offices and total assets under management (AUM) of Rs. 47,576 crore as on 30 June. A QIP will add Mahindra Finance to the long list of financial services companies that have opted for the route to raise funds this year.
Through the current year, there are 17 companies that have raised Rs. 34,181.5 crore, through QIP fund raising as per data from primary market. The fund raise will enhance the capital base of Non-Banking Financial Company and help boost its balance sheet. The company has witnessed a growth in its gross & net non-performing assets (NPA) and higher provisions for the same, as per company’s statement.
