Indian Railway Finance Corporation Ltd
For Detailed tax Analysis of above Please read the Following Post:-
Interest rates are at peak level; best time to invest in fixed income tax free instruments.
Interest rate cycle has peaked outGiven the sharp slowdown in the industrial activity and softening of the food inflation, the interest rate cycle has peaked out. Reserve Bank of India has restrained from increasing the interest rates in the last policy review meet and is expected to begin reducing rates in March or April 2012. The bond yields which have increased close to 9% levels have corrected significantly and show easing of pressure on rates.
High post tax yield for triple A rated productTax free bond with yield of 8% – 8.30% is comparable with yields offered on government bonds and offer extremely attractive pre-tax yield close to 12% for a long period of time. The bond issue has got AAA (stable) rating from the rating agencies – Crisil, ICRA and CARE. The bonds would also be listed and tradable on NSE/BSE.
Terms of the Issue:
|Face Value per Bond||Rs 1,000|
|Tenor||10 years||15 years|
|Minimum Application||Rs 10,000 (in multiples of Rs 5,000 thereafter)||Rs 10,000 (in multiples of Rs 5,000 thereafter)|
|Interest Rate % p.a. (Category I & II)||8.00||8.10|
|Interest Rate % p.a. (Category III)||8.15||8.30|
|Frequency of Interest payment||Annual||Annual|
or physical formdemat form or physical form
|Interest on application % p.a.||8.00|
|Interest on refund % p.a||4.00|
|Category I||Category II||Category III|
|Upto 45% of Overall Issue Size*||Upto 25% of Overall Issue Size*||Upto 30% of Overall Issue Size*|
|QIB & Corporate||Individuals & HUF applying for more than Rs. 5 Lakhs||Individuals & HUF applying for upto Rs. 5 Lakhs|
|*on first come first serve basis to be determined on the basis of date of receipt of applications duly acknowledged by the Bankers to the Issue.|
* The coupon rates of 8.15% p.a. and 8.30% p.a. shall be payable only to the original allottees under Category III for the Tranche 1 and Series I Bonds and Tranche 1 and Series II Bonds respectively and shall not be payable to the transferees in case the Bonds are transferred or sold by the original allottees Please refer to the final prospectus for details.
* For the purpose of information only, invest only after referring to the final prospectus.