PublicissueofSecuredNonConvertibleDebentures(NCDs)by

MuthootFinanceLimited

FrequentlyAskedQuestions

Whatisthenatureandsizeoftheissue?

PublicIssueofSecured,NonconvertibleDebentures(NCDs)ofFaceValueof`1,000eachaggregating
upto ` 2,500 million with an option to retain oversubscription upto ` 2,500 million for issuance of
additionalNCDs,aggregatingtoatotalofupto`5,000million

WhatistheIssueSchedule?

TheIssueshallremainopenfrom17thSeptember2012to5thOctober2012withanoptiontocloseearlier
and/orextenduptoaperiodasmaybedeterminedbytheNCDPublicIssueCommitteeoftheBoard.
It may be noted that the Issue shall remain open for subscription from 10:00 a.m. to 5:00 p.m. (Indian
StandardTime)fortheperiodindicatedabove.

Whoaretheeligibleinvestors?

Thefollowingcategoriesofinvestorsareeligibletoapply:

CategoryI CategoryII CategoryIII

Public Financial Institutions, Companies; bodies corporate Resident Indian

Statutory Corporations, and societies registered under individuals and Hindu
Commercial Banks, Co theapplicablelawsinIndiaand Undivided Families
operative Banks and authorised to invest in the
through the Karta
Regional Rural Banks, which NCDs;
are authorised to invest in Public / private charitable / applying for NCDs
theNCDs; religious trusts which are aggregating to a value
Provident Funds, Pension authorised to invest in the notmorethan`500,000,
Funds, Superannuation NCDs; acrossallseriesofNCDs
Funds and Gratuity Fund, Scientific and/or industrial
which are authorised to research organisations, which
investintheNCDs; are authorised to invest in the
Venture Capital funds NCDs;
registeredwithSEBI; Partnership firms in the name
InsuranceCompanies; ofthepartners;
Stateindustrialdevelopment Limited liability partnerships
corporations; formed and registered under
Insurance funds set up and the provisions of the Limited
managed by the army, navy, Liability Partnership Act, 2008;
or air force of the Union of and

India; Resident Indian individuals and

Insurance funds set up and
managedbytheDepartment
ofPosts,theUnionofIndia;
National Investment Fund;
and
MutualFunds
Hindu Undivided Families
through the Karta applying for
NCDs aggregating to a value
exceeding ` 500,000, across all
seriesofNCDs

Whataretheallocationstorespectivecategories?

CategoryI CategoryII CategoryIII

15%ofthetotalissuesize 35%ofthetotalissuesize 50%ofthetotalissuesize

WhoallarenoteligibletoinvestintheseNCDs?

Minors without a guardian name (a guardian may apply on behalf of a minor. However, the
guardiannamewillneedtobementionedontheapplicationform);
Foreignnationals;
PersonsresidentoutsideIndia;
ForeignInstitutionalInvestors;
NonResidentIndians;
QualifiedForeignInvestors;
OverseasCorporateBodies;
ForeignVentureCapitalFunds;
Personsineligibletocontractunderapplicablestatutory/regulatoryrequirements

Whatarethebrieftermsofthebonds/NCDs?

Particulars OptionI OptionII OptionIII OptionIV OptionV
Facevalue ` 1,000 ` 1,000 ` 1,000 ` 1,000 ` 1,000
IssuePrice ` 1,000 ` 1,000 ` 1,000 ` 1,000 ` 1,000
Minimum ` 10,000.(10NCDs)(foralloptionsofNCDs,namelyOptionsI,OptionII,OptionIII, Option
application IVandOptionVeithertakenindividuallyorcollectively)
Tenor 24months 36months 60months 60months 72months
Rating [ICRA]AAbyICRAandCRISILAA/StablebyCRISIL
Coupon rate 11.50% 11.75% 11.75% 12.00% NA
for NCD
holders
across
Categories
Effective Yield 11.50% 11.75% 12.40% 12.00% 12.25%
(perannum)for
NCD Holders
across
Categories

Frequency Annual Annual Monthly Annual OnMaturity

of Interest
Payment
Mode of Dematerialized Dematerialized Dematerialized Dematerialized Compulsorily in
Allotment or physical or physical or physical or physical dematerialized
form form form form form
Terms of Full amount on Full amount on Full amount on Full amount on Full amount on
payment application application application application application
Put and/or None
CallOption

AretheseBondssecured?

Yes.TheseNCDsaresecuredbyfirstparipassuchargeontheidentifiedimmovablepropertyandafirst
paripassuchargeoncurrentassets,bookdebts,loansandadvances,andreceivablesincludinggoldloan
receivables,bothpresentandfutureoftheCompany,asmaybedecidedmutuallybytheCompanyand
theDebentureTrusteetotheextentoftheamountoutstandinginrespectoftheDebenturesatanytime.
TheCompanywillmaintainsecurityinfavouroftheDebentureTrusteefortheNCDholdersontheassets
toensure100%securitycoveroftheamountoutstandinginrespectofNCDsatanytime.

Whatistheinterestonapplicationmoney?

The Company shall pay interest on application money on the amount allotted, subject to deduction of
income tax under the provisions of the Income Tax Act, 1961, as amended, as applicable, to any
applicants(exceptforASBAapplicants)towhomNCDsareallottedpursuanttotheIssuefromthedateof
realizationofapplicationamountorafter3(three)daysfromthedateofuploadoftheapplicationonthe
stockexchanges,whicheverislateranduptoonedaypriortotheDeemedDateofAllotment,attherate
of11.50%p.a.

Whatistheinterestonrefund?

TheCompanyshallpayinterestonApplicationAmountswhichisliabletoberefundedtotheApplicantsin
accordance with the provisions of the SEBI Debt Regulations and/or the Companies Act, or other
applicable statutory and/or regulatory requirements, subject to deduction of income tax under the
provisionsoftheITAct,asapplicable,fromthedateofrealizationoftheApplicationAmountsorafter3
(three)daysfromthedateofuploadoftheApplicationontheelectronicplatformoftheStockExchanges
whicheverislateranduptoonedaypriortotheDeemedDateofAllotment,attherateof6%perannum.

Whatisthebasisofallotment?

Applicants will be allocated NCDs on first come first serve basis (determined on the basis of date of
uploadoftheApplicationontheelectronicplatformofBSEandNSE);
ApplicantsbelongingtoCategoryIwillbeallocatedupto15%oftheIssuesize,applicantsbelongingto
Category II will be allocated NCDs upto 35% of Issue size, applicants belonging to Category III will be
allocatedNCDsupto50%ofIssuesizeonfirstcomefirstservebasis(determinedonthebasisofdateof
uploadoftheApplicationontheelectronicplatformofBSEandNSE)

Undersubscription:Ifthereisanyundersubscriptioninanycategory,priorityinallotmentswillbegiven
totheIndividualCategoryPortion,andbalance,ifany,shallbefirstmadetoapplicantsofCategoryNon

Institutional Portion, followed by Category the Institutional Portion on a first come first serve basis, on
proportionatebasis.

Oversubscription:Incaseofanoversubscription,allotmentstothemaximumextent,aspossible,willbe
madeonafirstcomefirstservebasisandthereafteronproportionatebasis,i.e.fullallotmentofNCDsto
the Applicants on a first come first basis up to the date falling 1 (one) day prior to the date of
oversubscriptionandproportionateallotmentofNCDstotheapplicantsonthedateofoversubscription
(basedonthedateofuploadoftheApplicationontheelectronicplatformofBSEandNSE).

WhatistheTaxTreatmentofinterestontheseBonds?AretheseBondsTaxFree?

Theinterestreceivedonthesebondsshallbetreatedasincomefromothersourcesandshallformpartof
thetotalincomeoftheassesseinthatfinancialyearinwhichtheyarereceived.Therearenotaxbenefits
ofinvestingintheseBonds.

WillTDSbedeductedonthesebonds?

Asperclause(ix)ofsection193oftheITAct,notaxisrequiredtobewithheldonanyinterestpayableon
any security issued by a company, where such security is in dematerialized form and is listed on a
recognized stock exchange in India in accordance with the SCRA and the rules made thereunder.
Accordingly,notaxwillbedeductedatsourcefromtheinterestonlistedNCDsheldinthedematerialised
form.
HoweverincaseofNCDsheldinphysicalform,asperthecurrentprovisionsoftheITAct,taxwillnotbe
deducted at source from interest payable on such NCDs held by the investor, if such interest does not
exceed ` 5,000 in any financial year. If interest exceeds the prescribed limit of ` 5,000 on account of
interestontheNCDs,thenthetaxwillbedeductedatapplicablerate.

Idon'thaveDematAccount.CanIapply?

Yes.Thebondsshallbeissuedindematerializedandphysicalform,soinvestorswithoutDematAccounts
areeligibletoinvestintheseNCDs.

IonlyhaveajointDemataccount.CanIapplyinmyownnameonly?

ThenamesofapplicantsshallbesameastheholdersofDemataccount.Incaseofsingleapplicant the
demataccountshallalsobeheldinthenameofthesamesingleapplicant.

CanIapplyinjointnames?

Yes. Application can be made in joint names with a maximum of three applicants. In the case of joint
Applications, all payments will be made out in favour of the first Applicant. All communications will be
addressedtothefirstnamedApplicantwhosenameappearsintheApplicationFormandattheaddress
mentionedtherein.Incaseofjointapplication,thedemataccountshallalsobeheldinthejointnames
andorderofapplicantsshallbethesameasappearinginthedemataccount.

CanIinvestinalltheoptions?

Yes. an applicant may subscribe to all the options but the minimum application shall be ` 10,000 (10
NCDs)oralloptionsofNCDs,namelyOptionsI,OptionII,OptionIII,OptionIVandOptionVeithertaken
individually or collectively. Please note however that the allotment for Option V will only be made in

dematerializedform.

Idon'thaveaPANcard.CanIstillapplyforsubscription?

Anyapplicationform,withoutthePANnumberisliabletoberejected

HowwillIgetmyinterestontheduedateandmaturityproceedsonredemptiondate?

IncaseofNCDsappliedindematerializedform,theinterestand/orredemptionproceedsshallbecredited
to the respective bank account registered with the Depository Participant on the due date for interest
paymentandredemptiondateforredemptionproceedsrespectively.

IncaseofNCDsappliedinphysicalform,thebankdetailswillbeobtainedfromtheRegistrartotheIssue
for payment of interest/ refund /redemption as the case may be. The mode of interest / refund /
redemptionpaymentsshallbeundertakeninthefollowingorderofpreference:
1.DirectCredit
2.NECS
3.RTGS
4.NEFT
5.RegisteredPost/SpeedPost

Ifthedateofinterestpaymentand/ormaturityifNCDsfallsonaSaturday,Sundayorapublicholidayin
Mumbai or any other payment centre notified in terms of the Negotiable Instruments Act, 1881, then
interestand/orredemptionamountasdueandpayableonsuchday,wouldbepaidonthenextworking
day.

WhoshallpaytheinterestandrepaythePrincipalamount?

The Issuer (Muthoot Finance Limited) shall pay the interest on these bonds on the respective interest
paymentdates.TheIssuershallpaytheprincipleamounttotheInvestorontherespectivematuritydates
ofthebonds/NCDs

Whowouldgettheinterestincaseofajointapplication?

Incaseofajointapplicationtheinterestshallbepaidtotheaccountofthefirstapplicantonly.

Whatarethemethodsofapplication?

An eligible investor desirous of applying in the Issue can make Applications by one of the following
methods:
1. Applications through the ASBA process as introduced by SEBI by blocking the Application amount in
theirbankaccountmaintainedwithSCSBbanks;or
2.NonASBAApplications.

ApplicantsarerequestedtonotethatintermsoftheDebtApplicationCircular,SEBIhasmandatedissuers
toprovide,througharecognizedstockexchangewhichofferssuchafacility,anonlineinterfaceenabling
directapplicationbyinvestorstoapublicissueofdebtsecuritieswithanonlinepaymentfacility(Direct
OnlineApplicationMechanism).Inthisregard,SEBIhas,throughtheDebtApplicationCircular,directed
recognized stock exchanges in India to put in necessary systems and infrastructure for the

implementation of the Debt Application Circular and the Direct Online Application Mechanism. In the
eventthattheStockExchangesputinnecessarysystems,infrastructureandprocessesinplacesoasto
enabletheadoptionoftheDirectOnlineApplicationCircularpriortotheIssueOpeningDate,theIssuer
shalloffereligibleinvestorsdesirousofapplyingintheIssuetheoptiontomakeApplicationsthroughthe
Direct Online Application Mechanism. In such an event, the methods and procedure for relating to the
DirectOnlineApplicationMechanismshallbewidelydisseminatedbytheIssuerthroughapublicnoticein
areputednationaldailynewspaper.

Fordetaileddescriptionandproceduresinvolvedintheabove,pleaserefertopage177oftheProspectus.

Whatarethemethodsofpayment?

Methods of payment shall differ for applications made through ASBA process and for nonASBA
applications.Fordetailedmechanism,pleaserefertopage182oftheProspectus.

CanIapplythroughmultipleapplications?

AnApplicantisallowedtomakeoneormoreApplicationsfortheNCDsforthesameorotherOptionsof
NCDs,subjecttoaminimumApplicationsizeof`10,000andinmultiplesof`1,000thereafter,foreach
Application.AnyApplicationforanamountbelowtheaforesaidminimumApplicationsizewillbedeemed
as an invalid Application and shall be rejected. However, multiple Applications by the same Applicant
belongingtoCategoryIIIaggregatingtoavalueexceeding`500,000shallbegroupedinCategoryII,for
thepurposeofdeterminingthebasisofallotmenttosuchApplicant.However,anyApplicationmadeby
anypersoninhisindividualcapacityandanApplicationmadebysuchpersoninhiscapacityasaKartaof
an HUF and/or as joint Applicant (second or third applicant), shall not be deemed to be a multiple
Application.

HowWillIknow,ifIhavebeenallottedanyBonds?

Link Intime India Private Limited, who is the Registrar to the Issue (The Registrar) shall issue an
allotment advice capturing the date of allotment, number of bonds allotted in each of the category,
amount refunded, tax deducted etc. Your demat details will also be captured in case of application for
bondsindematerializedform.Incaseofanyerrorontheallotmentadvicepleasegetintouchwiththe
RegistraratTel:(9122)25967878

Whatarethedocuments/certificatesthatneedtobefiledalongwiththeApplicationForm?

Incaseofapplicationsby/under: Followingdocumentsarerequired:
MutualFunds Certifiedtruecopiesof:
(i)SEBIRegistrationCertificateandtrustdeed
(ii)Resolutionauthorizinginvestmentandcontaining
operatinginstructionsand
(iii)Specimensignaturesofauthorizedsignatories
Scheduled Banks, Cooperative Banks and Regional Rural Certifiedtruecopiesof:
Banks (i)BoardResolutionauthorisinginvestments
(ii)LetterofAuthorisation
InsuranceCompanies Certifiedtruecopiesof:
(i)MemorandumandArticlesofAssociation
(ii)PowerofAttorney
(iii)Resolutionauthorisinginvestmentandcontaining
operatinginstructions

Trusts
PublicFinancialInstitutions,StatutoryCorporations,whichare
authorizedtoinvestintheNCDs
Companies, bodies corporate and societies registered under
theapplicablelawsinIndia
Indian Scientific and/or industrial research organizations,
whichareauthorizedtoinvestintheNCDs
PartnershipfirmsformedunderapplicableIndianlawsinthe
nameofthepartnersandLimitedliabilitypartnershipsformed
and registered under the provisions of the Limited Liability
PartnershipAct,2008(No.6of2009)
PowerofAttorney
Itmaybenotedthatinalltheabovecategories,thePANmustbementionedontheapplication.
(iv)Specimensignaturesofauthorizedsignatories
Certifiedtruecopiesof:
(i)Registeredinstrumentforcreationofsuchtrust
(ii)PowerofAttorney,ifany,infavourofoneormore
trusteesthereof
(iii)Suchotherdocumentsevidencingregistrationthereof
underapplicablestatutory/regulatoryrequirements
Certifiedtruecopiesof:
(i)AnyAct/Rulesunderwhichtheyareincorporated
(ii)BoardResolutionauthorisinginvestments
(iii)Specimensignatureofauthorizedperson
Certifiedtruecopiesof:
(i)AnyAct/Rulesunderwhichtheyareincorporated
(ii)BoardResolutionauthorisinginvestments
(iii)Specimensignatureofauthorizedperson
Certifiedtruecopiesof:
(i)AnyAct/Rulesunderwhichtheyareincorporated
(ii)BoardResolutionauthorisinginvestments
(iii)Specimensignatureofauthorizedperson
Certifiedtruecopiesof:
(i)PartnershipDeed
(ii)Anydocumentsevidencingregistrationthereofunder
applicablestatutory/regulatoryrequirements
(iii)Resolutionauthorizinginvestmentandcontaining
operatinginstructions(Resolution)
(iv)Specimensignatureofauthorizedperson
(i)IncaseofInvestmentsmadepursuanttoapowerof
attorneybyCategoryIinvestors,acertifiedcopyofthe
powerofattorneyortherelevantresolutionorauthority,
asthecasemaybe,alongwithacertifiedcopyofthe
memorandumofassociationandarticlesofassociation
and/orbyelawsand/orcharterdocuments,as
applicable,mustbelodged
(ii)IncaseofInvestmentsmadepursuanttoapowerof
attorney by Category II, and Category III investors, a
certifiedcopyofthepowerofattorneymustbelodged

ThefollowingKYCDocumentstobesubmittedbyApplicantsOptingforNCDsinthePhysicalForm:
(a)SelfattestedcopyofthePANcard
(b)Selfattestedcopyoftheproofofresidence.Anyofthefollowingdocumentsshallbeconsideredasa
verifiableproofofresidence:
rationcardissuedbytheGoIor
validdrivinglicenseissuedbyanytransportauthorityoftheRepublicofIndiaor
electricitybill(notolderthanthreemonths)or
landlinetelephonebill(notolderthanthreemonths)or
validpassportissuedbytheGoIor
VotersIdentityCardissuedbytheGoIor
passbookorlatestbankstatementissuedbyabankoperatinginIndia
registered leave and license agreement or agreement for sale or rent agreement or flat
maintenancebill
(c) Selfattested copy of a cancelled cheque of the bank account to which the amounts pertaining to
paymentofrefunds,interestandredemption,asapplicable,shouldbecredited.