Capacit'e Infraprojects raises ₹55 crore (~$6.5M) via NCDs at 12.72% coupon
What's the deal? Indian construction and project management firm Capacit'e InfraprojectsDealroom has a profile for this one. Try Dealroom → has raised ₹55 crore (~$6.5M) through non-convertible debentures (NCDs) placed privately. The secured NCDs carry a 12.72% annual coupon rate, paid monthly, with a 42-month tenure and repayment via 13 equal quarterly instalments.
The total issue includes a base size of ₹35 crore and a greenshoe option of ₹20 crore. Each debenture has a face value of ₹10 lakh.
Why now? Infrastructure companies routinely tap debt markets to fund capital-intensive projects, and Capacit'e — which undertakes large-scale building and infrastructure work — needs steady financing to support its pipeline. The private placement route lets it raise funds quickly without the regulatory overhead of a public offering.
What could go wrong? The filing flags a 2% per annum default penalty if the company misses any payment. While the NCDs are secured by a mortgage over certain immovable properties, a subservient charge over current assets, and promoter guarantees, investors still face execution risk tied to the company's project performance and overall financial health.
A 12.72% coupon on secured debt is notably high, which could signal either elevated borrowing costs in the sector or the market's perception of credit risk around the issuer.
The signal: Capacit'e Infraprojects' decision to tap private debt at a 12.72% coupon — well above benchmark lending rates — highlights the uneven access to capital among India's mid-tier construction firms, even as the sector benefits from a sustained public-spending push. For a late-stage company that has long relied on large-scale residential, commercial, and institutional building contracts, the choice to issue secured NCDs rather than dilute equity suggests confidence in its project pipeline but limited leverage to negotiate cheaper financing.
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