Posted on 1 comments

Asset update: Wint Bricks Nov21

The much-awaited, Wint Bricks Nov21 is the 8th asset on our platform and it is a senior secured bond providing a 10.5% XIRR return with interest being paid on a monthly basis with a minimum investment of ₹10,000 only.


Yes you read that right, #10kIsBack


Once you invest in this asset, you will earn interest on a monthly basis and receive 33.33% principal repayment every 9 months till 27 months (basically, till the time the tenure of the asset is over).


The principal repayment feature reduces your risk considerably while giving you the option to reinvest in other assets on Wint Wealth or elsewhere.


The NCDs in Wint Bricks Nov21 are secured by SME business loans which are backed by property and emergency credit line loans guaranteed by the Government of India and it is the first senior secured bond on Wint Wealth’s platform.


A senior secured bond is a bond that is backed by a security pool like gold loans, vehicle loans, or property loans. For example, Wint Bricks Nov’21 is a ₹50 crore bond backed by property loans with a minimum of 1.25x worth of security pool (currently) and the NBFC would have to maintain a security pool of a minimum of 1.25X of the outstanding principal throughout the tenure of the bond. 


The term “senior” in a senior secured bond indicates that bondholders enjoy the senior-most priority to get repaid in case the NBFC defaults.


If you want to know why this asset is not a covered bond like earlier assets, you can read about it here


Now that you are got familiar with senior secured bonds, let’s take a quick look at some of the specifications of Wint Bricks Nov21:

Name Wint Bricks Nov21
Collateral Security pool worth a minimum of 1.25x of the Issue Size. Security pool consists of Business loans backed by property or emergency credit line loans guaranteed by the Government of India.
Pre – Tax Returns 10.5% XIRR
Product Structure Senior secured bond
Tenure 27 months (33.33% of principal get repaid every 9th month hence reducing risk on overall principal)
NBFC Ugro Capital Ltd.
Credit Rating of the NBFC A (positive outlook) rated by Acuite

Why Did We Choose Ugro Capital as Our Partner?

  • Ugro Capital has a leverage ratio of just 1.14x. This means that entity has taken a debt of ₹ 114 for ₹ 100 of its own money. Note that regulations allow NBFCs to take leverage up to ~6 times and many NBFCs operate at leverage ranging between 4-5 times. In that context, the leverage of Ugro is relatively low. Lower leverage provides a cushion to the lenders since any losses in the portfolio get absorbed by equity. Hence higher the equity percentage lowers the risks for the lenders;
  • It is a listed entity with an experienced board of directors and good corporate governance.


Read the blog below to learn how Wint Wealth partners with NBFCs:


Now you must be wondering, how Wint Bricks Nov21 is different from other secured bonds in the market?


Below are the three ways in which we have tried to reduce risks in Wint Bricks Nov21:


Features Wint Bricks Nov21 Other Secured bonds
Reduction in credit risk Partial repayment of principal every 9 months increases the chances of not losing the entire investment. The majority of the senior secured bonds in the market have a bullet repayment structure and hence pay principal at maturity which carries high credit risk as the entire principal can be lost in case the NBFC defaults.
Over collateralisation Wint Bricks Nov21 is backed by a pool of property loans, which is 1.25X of the bond value. This provides more cushion to bondholders in case of bankruptcy. Over collateralisation, the feature is rarely available in other secured bonds, in most cases the collateral value is equal to the value of the bond.


Although we have tried reducing risks via structuring and due diligence, these assets still carry a fair amount of risk.

What are the Risks Involved?

Any financial instrument involves some amount of risk. Every investor must understand the associated risks before they allocate money to an instrument. Although, risk mitigants are employed for all Wint Wealth assets.

There are 3 major risks involved:

  • Credit risk
  • Liquidity risk
  • Fraud risk


1. Credit Risk


Credit risk is the risk that an investor might not be able to recover his/her invested principal amount because of an NBFC declaring bankruptcy.


If the NBFC defaults, it will enter into bankruptcy proceedings, which is a lengthy process.



Although we have a 1.25x cover pool, a complete recovery of investment is not guaranteed. Investors will have a chance to lose principal amounts too. Also, recovery can take a long time.


To reduce credit risk, We have structured cash flows in such a way where 33.33% of the Principal is repaid every 9 months. This reduces credit risk considerably and decreases the possibility of losing 100% of the principal.


The term “senior” in a senior secured bond indicates that bondholders enjoy the senior-most priority to get repaid in case the NBFC defaults.


This means we will get maximum recovery if the company defaults. 


2. Liquidity Risk


This is an illiquid asset. So invest only with the mindset to hold till maturity.


In case an investor wants to withdraw early, we will try to reach out to investors on our waitlist and try to match the withdrawal request. However, there is no guarantee that such a buyer would always be present.


3. Fraud Risk


Like all investment products, fraud risk may be present in this asset class as well.


What if in the specified collateral (cover pool), the property/borrower does not exist and fraudulent information has been given?


In such a scenario, legal actions will be taken against the company for the recovery of your investments. But you could potentially lose your principal investment as well. Also, this could delay the investment recovery by a lot.


How do we try to minimise fraud risk?


We have a strict onboarding process to ensure we partner with high-quality NBFCs. We conduct thorough due diligence of the NBFC’s systems, processes and records.


In addition to the credit risk analysis of the NBFC, we cherry-pick loans from a loan pool and we do multiple verification checks on them to minimize fraud.


Some of them are PAN Verification of the borrower, loan charge verification of property on the “CERSAI” portal.


To summarise, Wint Wealth only brings products that give better risk-adjusted returns. Wint Bricks Nov21 is one such product backed by property, offering a 10.5% XIRR return, and the structure is a senior secured bond.


Feel free to reach out to our team for any queries on WhatsApp or at


If you have read till here, you now know a fair amount about the asset. However, if you are a finance geek, and are curious about how Wint Wealth cherry-picks loans for their cover pool, we have some more information for you. 



How Did We Choose Loans for Wint Bricks Nov21?


  • Each loan must be originated by the Company and must be a loan secured by property or emergency credit line loans guaranteed by the Government of India.
  • Loans must be unencumbered (other than under the Transaction Documents) and not sold or assigned by the Company.
  • The loan should also comply with all existing, ‘Know Your Customer’ norms specified by the RBI;
  • Loans are current and not overdue at the time of hypothecation and have not been terminated or prepaid. At the time of additional hypothecation, only those loans which don’t meet the eligibility criteria can be replaced by the entity after transaction settlement.
  • No loans must have DPD>60. (days past due)
  • The maximum concentration of loans having DPD>0 should be 5% of the total principal value of security cover.
  • For the purpose of calculation of security cover, only principal receivables of the Loans till 96 months from the Deemed Date of Allotment should be taken into consideration.
  • Loans constituting the assets and in the following sectors should have a minimum seasoning of 2 months:
    • Auto components 
    • Electrical Equipment
    • Food Processing
    • Healthcare
    • Light Engineering
    • Chemicals
  • Loans constituting the assets and in the following sectors should have a minimum seasoning of 9 months:
    • Education
    • Hospitality
  • The concentration of loans in the hospitality sector should be a maximum of 10% of the total principal value of security cover. 
  • The maximum ticket size per Loan should be 5% of the actual issuance amount or INR 3,00,00,000, whichever is lower.
  • The minimum IRR of the Loans must be 10 Percent.
  • Loan to value of the contracts should be less than or equal to 70%.
  • The concentration of ECLGS loans must not be more than 20% of the total principal value of security cover.
  • The concentration of an individual borrower should not be more than 5% of the total principal value of security cover.
  • Charge in Collateral Property should be registered in CERSAI and MCA in the case of the company.

As you read above, Wint Wealth mitigates the risk by carrying out extensive due diligence and choosing loans very cautiously.


Happy Winting!

One thought on “Asset update: Wint Bricks Nov21

Leave a Reply

Your email address will not be published.