Shriram City Union Finance company’s secured non-convertible debentures (NCD) is offering effective yield of 11.50 % per annum for maturity of five years.
Retail financing NBFC Shriram City Union Finance company’s non-convertible debentures (NCD) issue opened for subscription on November 25 and closes on December 24, 2013. The company has reserved 40% NCDs for retail investors, 40% for HNIs and 10% each for institutional and non-institutional investors.
Who can apply: Resident individuals, HUFs, partnership firms, companies and body corporates, banks, public financial institutions, national investment funds, mutual funds, venture capital, insurance companies, commercial banks, co-operative banks, public/private charitable trusts, industrial research organizations and other eligible categories can invest in this NCD.
Application size: The minimum application size is Rs. 10,000 for 10 NCDs as the face value per debenture is Rs. 1000. Shriram aims to collect Rs. 100 crore with an option to retain an additional Rs. 100 crore if the issue oversubscribes.
Credit Ratings: CARE has assigned a rating of AA. Such instruments carry very low credit risk and high degree of safety regarding timely servicing of financial obligations.
Tentative brokerage structure: The brokerage ranges between 1.15% (3 and 4 years) and 1.4% (5years) per application offered upfront.
Effective yield and maturity:
|
Effective Yield/ Tenure |
36 months |
48 months |
60 months |
|
For Non-Individual Investors |
10.75% |
10.75% |
10.75% |
|
For Individual Investors |
11% |
11.25% |
11.50% |
|
Post Tax Return for an individual falls under 30.90% tax bracket |
7.60% |
7.77% |
7.95% |
|
Post Tax Return for an individual falls under 20.60% tax bracket |
8.73% |
8.93% |
9.13% |
|
Post Tax Return for an
individual falls under 10.30% tax bracket |
9.87% |
10.09% |
10.32% |
Note- the post-tax returns are calculated by a formula – rate*(1-tax rate)
Who can sell the product: Registered stock brokers with any stock exchange along with their respective sub-brokers, banks and intermediaries selected by the issuing company.
How can an IFA get registered to sell the product: An IFA has to sign the sub-broker agreement with a stock broker to be eligible to sell these NCDs.
Trustee: GDA Trusteeship Services.
Registrars: Shriram Insight Share Brokers Limited.
Depositories: NSCL and CDSL.
Listing: The NCDs will be listed on both BSE and NSE. Investors can also apply in physical mode. However, for NRIs, the issue is only available in dematerialized form.
Lead managers: ICICI Securities
Lead brokers: A.K. Stockmart, Axis Capital, Edelweiss Broking, HDFC Securities, ICICI Securities, India Infoline, Integrated Enterprises, JM Financial Services, Karvy Stock Broking, Kotak Securities , R R Equity Brokers, SHCIL Services, SMC Global Securities, TATA Securities, Tipsons Stock Brokers , SPA Securities, Just Trade Securities and Trust Financial Consultancy Services.
