Tax free bond of India Infrastructure Finance Company Limited (IIFCL) offers an attractive coupon rate of 8.91% per annum to retail investors for the tenure of 20 years.
India Infrastructure Finance Company Limited (IIFCL) tax free secured redeemable non-convertible bonds (NCB) will open for subscription on December 9 and close on January 10, 2014. The company has reserved 40% NCBs for retail investors, 25% for HNIs and 20% for domestic corporate and 15% for QIB portion.
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. 5000 for 5 Tax free bonds as the face value per debenture is Rs. 1000. IIFCL aims to collect Rs. 1000 crore with an option to retain an additional Rs. 2000 crore if the issue oversubscribes.
Credit Ratings: ICRA, Brickwork, IRRPL and CARE have assigned a rating of AAA (Triple AAA). 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 0.20% and 0.75% per application offered upfront.
Effective Yield:
|
Tax free effective yield |
10 years |
15 years |
20 years |
|
For retail investors |
8.41% |
8.48% |
8.66% |
|
For QIB, HNIs and Corporates |
8.66% |
8.73% |
8.91% |
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: IL&FS Trust Company.
Registrar: Karvy Computershare Limited.
Depositories: NSCL and CDSL.
Listing: The NCDs will be listed on BSE. Investors can also apply in physical mode.
Lead managers: SBI Capital Markets, A K Capital Services, Axis Capital, ICICI Securities, Karvy Investor Services, RR Investor Services.
