IFAs can recommend “IDFC Long-term Infrastructure Bonds - Tranche I” to their clients who are looking to generate steady income with added tax benefits
IDFC Long-term Infrastructure Bonds - Tranche I will be open till 16 December. Bondholders can avail the additional Rs 20,000 deduction under section 80CCF of the Income-tax Act (apart from the Rs one lakh deduction under section 80C).
Who can Apply: Resident Indian Individuals (Minors not eligible) and HUFs
Application Size: Minimum of two Tranche I bond and multiples of one Tranche I bond thereafter. Each bond has a face value of Rs. 5,000.
Availability: In dematerialized form or in physical form
Who can sell the product?
-
Registered stock-brokers with any Stock Exchange along with their respective sub-broker.
-
Banks and brokers selected by the issuing company
How can an IFA get registered to sell the product?
-
An IFA who wishes to sell the product needs to sign a sub-broker agreement with a stock-broker.
Tentative Brokerage structure:
On the allotment amount a brokerage of 1.25% is offered.
Also, following is an early bird scheme for brokers:
|
No of Applications sold between |
Application size of Rs 10,000 or more |
Application size of Rs 20,000 or more |
|
21 November - 30 November |
Rs 50 per application |
Rs 100 per application |
|
1 December - 12 December |
Rs 25 per application |
Rs 50 per application |
Bond Features
|
Options for Subscription |
I |
II |
|
Frequency of Interest Payment |
Annual |
Cumulative |
|
Yield on Maturity |
9% |
9% (Compounded Annually) |
|
Tenor |
10 years from the deemed date of allotment |
10 years from the deemed date of allotment |
|
Buyback option |
Yes |
Yes |
|
Buyback Dates |
Date falling 5 years and one day from the Deemed Date of Allotment | |
|
Lock-in Period |
Five years from the Deemed Date of Allotment | |
|
Maturity Date |
10 years from the Deemed Date of Allotment | |
|
Min Investment & Face Value |
Rs 5000 per bond | |
|
Investment in Multiples of |
Rs 5000 per bond | |
|
Tax Benefit |
Avail the additional Rs 20,000 deduction under section 80CCF of the Income-tax Act (apart from the Rs one lakh deduction under section 80C) | |
|
Buyback Amount |
Rs. 5,000 per Tranche 1 Bond |
Rs. 7,695 per Tranche 1 Bond. |
|
Maturity Amount |
Rs. 5,000 per Tranche 1 Bond |
Rs. 11,840 per Tranche 1 Bond |
|
Nature of the Bond |
Secured | |
|
Security Cover |
1.0 time the outstanding Tranche I Bonds at any point of time. | |
|
Credit Rating |
Assigned “(ICRA)AAA” from ICRA and “Fitch AAA(ind)” from Fitch | |
|
Issuance & Trading |
Bonds shall be issued both in dematerialized form and physical form. However, trading allowed only in dematerialized mode after the expiry of lock-in period of 5 years | |
Registrars: Karvy Computershare Pvt. Ltd.
Depositories: NSDL and CDSL
Listing: Bonds to be listed on BSE and NSE
Lead Brokers to IDFC Infra Bond: Almondz Global Securities, Karvy Stock Broking, Bajaj Capital Investor Services, Kotak Securities, Enam Securities, NJ India Invest, Edelweiss Broking, RR Equity Brokers, HDFC Securities, Sharekhan, IDBI Capital Market Services, SMC Global Securities, JM Financial Services, SBI Cap.
