Sammaan Capital to raise $300 million via secured social bonds

Mumbai: Mortgage-focused non-bank lender Sammaan Capital Ltd's board has approved raising $300 million through senior secured social bonds.

The bonds will carry a coupon of 8.95% and a tenure of three years, the company (formerly Indiabulls Housing Finance Ltd) informed the exchanges on Thursday. Interest will be paid semi-annually, on 28 February and 28 August each year, until maturity on 28 August 2028. The bonds are expected to be listed on the Global Securities Market (GSM) of the India International Exchange (IFSC) Ltd at GIFT City.

Deutsche Bank AG acted as the sole bookrunner for the issuance, executed through its Singapore branch, according to the subscription agreement dated 21 August.

Senior secured bonds are higher-yield instruments backed by collateral and rank senior in the capital structure, implying that if a company defaults on its debt obligations, these bonds are the first in line to be repaid. Social bonds, also known as social impact bonds and abbreviated as SIB, are issued to raise funds for a project with social benefits.

The non-bank financial company (NBFC) said it plans to use the proceeds for onward lending and other activities permitted under the Reserve Bank of India’s external commercial borrowing (ECB) guidelines, in line with its sustainable finance framework.

The mortgage lender provides housing finance, loans against property, and working capital loans to micro, small and medium enterprises. It is rated ‘AA/Stable’ by rating agencies like Crisil and Icra.

In its investor presentation, the company said it has raised $3.8 billion from 215 foreign institutions, of which it has repaid $3.5 billion in the last 10 years. In FY25, it raised $350 million and repaid $161 million.

Prior to this, the pace of incremental fundraising via foreign currency borrowing by the NBFC was slower than the pace of repayment since FY19, according to its investor presentation.

In FY19, Indiabulls Housing, reeling from the impact of the IL&FS crisis, faced accusations of sanctioning dubious loans to corporate entities and financial irregularities, leading to weak financials. The NBFC has since been on a recovery path, with founder Sameer Gehlaut completely exiting in late 2023. The NBFC was renamed Sammaan Capital effective July 2024.

Outstanding foreign currency borrowings stood at $375 million as of 30 June.

The company’s stock rose 1.10% to ₹122.80 on Thursday against a 0.13% rise in Nifty 50.

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