PNB Housing Finance seeks to raise Rs 12,000 crore through debt
At its annual general meeting on July 26, PNB Housing Finance will seek shareholder approval to raise Rs 12,000 crore through debt. This debt will be issued by means of non-convertible debentures. Debentures refer to secured bonds. This means that the money raised through the debentures is secured by specific assets. If the company defaults on the bonds, the secured assets are sold to pay the bondholders. Non-convertible debentures mean that these debentures cannot be converted into shares.
PNB Housing Finance will issue these debentures in a private placement. The private placement means that these debentures will not be publicly issued. They will be sold privately to investors such as large financial institutions. These non-convertible debentures will be issued in one or more tranches. Tranche means the part of the money which will be raised at one time through the issue of debentures. The specific purpose for which the money raised through these debentures has not been explicitly stated by PNB Housing Finance. But it will likely be used by the company to provide more home loans to its customers.
PNB Housing Finance shares are down more than 1% today. It is trading at around Rs326.80 per share.