NCDs available for Trading

 NCDs available for Trading

NCDs - are you investing in them ?

They promise more return, but do your post-tax and allied homework to assess if the risk element is worth it.

Bank fixed deposits, company fixed deposits and now a raft of non-convertible debenture issues — as a retail investor, you are indeed spoilt for choice. And, all of these are offering handsome returns, given the high interest rate regime.

A plain comparison on returns would suggest no scope for debate, as several companies issuing NCDs are promising double-digit rates, much more than bank or company FDs. But wait before taking a decision, as the apparent returns are just one way of looking at things. The risk element also needs to be considered.

Indiainfoline NCDs open for subscription

The NCDs proposed under this Issue have been rated ‘[ICRA]AA- (stable)’ by ICRA, and ‘CARE AA-' by CARE.

There are three investment options.

Option I (Annual interest payment): The redemption date or maturity period is 36 months from the deemed date of allotment and the coupon rate is 11.7% p.a. The interest payment is annual and the face value plus any interest that may have accrued is payable on redemption.

Option II:. NCDs will be redeemed at Rs 1,446 at the end of 40 months from the deemed date of allotment with an effective yield of 11.70% per anum.

Option III (Annual interest payment): The redemption date or maturity period is 60 months from the deemed date of allotment. The coupon rate is 11.9% per annum for Category III investors and 11.7% per annum for others. The interest payment is annual and the face value plus any interest that may have accrued is payable on redemption.