Hi,
A Good opportunity for High networth people to go for Tax Free Bonds with attractive Tax Free Interest rate of a public sector Govt. company with 'AAA' rating.
The highlights of the issue is as under.
PRIVATE PLACEMENT OF TAX FREE BONDS BY POWER FINANCE CORPORATION LTD.
The effective Pre Tax yield for Highest tax Bracket i.e. 30% slab People is @ 7.51% p.a TAX FREE = PRE TAX = 11.20% (FOR 10 YEARS)
A Good opportunity for High networth people to go for Tax Free Bonds with attractive Tax Free Interest rate of a public sector Govt. company with 'AAA' rating.
The highlights of the issue is as under.
PRIVATE PLACEMENT OF TAX FREE BONDS BY POWER FINANCE CORPORATION LTD.
ISSUE TIME TABLE
Issue Opening Date | Thursday | September 29, 2011 |
Issue Closing Date & pay in date | Friday | October 07, 2011 |
Deemed Date of Allotment | Saturday | October 15, 2011 |
HIGHLIGHTS OF THE BONDS
Issuer | Power Finance Corporation Ltd. | |
Issue Size | Rs. 150 crore with an option to retain oversubscription (PFC can retain total subscription amount of upto Rs. 5,000 crore) | |
Instrument | Secured Redeemable Non-Convertible Non-cumulative Tax-Free Bonds in the nature of Debentures Series 79 | |
Tax Benefits | 1. The income by way of interest will be entitled to exemption from income tax under section 10 (15) (iv) (h) of Income Tax Act, 1961 2. There will be no deduction of tax at source from the interest, which accrues to the bondholders in these bonds irrespective of the amount of the interest or the status of the investors | |
Instrument Form | In dematerialized form | |
Credit Rating | ‘AAA/Stable’ by CRISIL and ‘LAAA’ by ICRA | |
Face Value | Rs. 1,00,000/- per Bond | |
Issue & Redemption Price | At par i.e. Rs. 1,00,000/- per Bond | |
Minimum Subscription | 10 Bonds (Rs. 10.00 lakhs) and in multiples of 1 Bond (Rs. 1.00 lakh) thereafter | |
Options (Series) | Option-I (Series 79-A) | Option-II (Series 79-B) |
Tenure | 10 Years | 15 Years |
Put & Call Option | None | None |
Redemption Date | 15th October, 2021 | 15th October, 2026 |
Coupon Rate | 7.51% p.a. | 7.75% p.a. |
Interest Payment Date | 15th October every year till maturity | |
Listing | Proposed on the Wholesale Debt Market (WDM) Segment of National Stock Exchange of India Ltd. (NSE) | |
Trustee | PNB Investment Services Ltd. | |
Interest on Application Money | At the coupon rate from the date of credit in PFC account till the date prior to the deemed date of allotment (to be paid along with the first interest) | |
@ 7.75% p.a TAX FREE = PRE TAX = 11.56% (FOR 15 YEARS)
