The issue proceeds are proposed to be used for the company’s infrastructure lending activities, Chairman and Managing Director of the company S K Goel told reporters here today. The issue which opened for subscription on February 4 would close on March 4. The Tax Saving Bond which will have five-year locking period has four series with rate of interest ranging between 8.15 per cent and 8.30 per cent, Godel said, adding that the face value of the Bond is Rs 1,000.
The bonds are proposed to be listed on the Bombay Stock Exchange.
The bonds have been assigned a credit rating of “AAA/ Stable” by CRISIL and “CARE AAA” by CARE indicating ‘Highest Safety’ with regard to timely payment of interest and repayment of principal amount of the bonds.
Bonds issued by the company will be secured by an exclusive first charge on the receivables of the company, with an asset cover of one time of the total outstanding amount of Bonds, Goel said.
Company profile
IIFCL is a wholly-owned Government company providing financial assistance to long-term infrastructure projects. As on 30 Sept 2010; 105 of the 124 projects for which IIFCL has sanctioned finances. As on March 31, 2010 and September 30, 2010, it had no non-performing advances. The GoI has identified infrastructure development as a key priority and the Eleventh 5 Year Plan (FY 2008-2012) and envisage investments of US$ 514 bn. in the Indian infrastructure sector. Thus, IIFCL is expected to play a prominent role in the infrastructure finance space in India going forward.
Salient features of the bond issue (Tranche I)
- First Bond Issue by a Government of India enterprise with tax benefits under Sec 80CCF of the Income Tax Act, 1961.
- Credit rating agency CRISIL has rated the Bonds under this offer as “AAA/Stable” and CARE has rated the bonds “CARE AAA” with stable outlook, indicating highest safety.
- These bonds will be issued only to Resident Indian Individuals (Major) and HUF.
- Available in 4 Series with diverse maturity; Series I & II having maturity of 10 years and Series III & IV having maturity of 15 years.
- The bonds are fully secured with first charge over receivables of the Company. The security cover is 1.0 times of the outstanding Bonds at any point in time.
- The Bonds bear an attractive combination of coupon rate 8.15% p.a. (Series I and II) and 8.30% p.a. (Series III and IV).
- All the 4 Bond Series provide buyback option to investors.
- Bonds can be held in DEMAT form or physical form as per investor preference. The bonds will be listed on BSE and can be traded post 5 year lock – in period.
- As per the current provisions of the I.T. Act, for bonds held in DEMAT form; no TDS will be deducted on interest on Bonds. If bonds are held in physical form, no tax may be withheld if such interest does not exceed Rs 2,500 in a financial year. However, such interest is taxable income in the hands of Bondholders.
- Investors can mortgage or pledge these bonds to avail loans after the lock-in period.
- Under Section 80 CCF of the I.T. Act, an investor in such infrastructure bonds will be entitled to tax deduction of investments of up to Rs 20,000 over and above the Rs 1,00,000 deduction available under section 80C, 80CCC & 80CCD read with section 80CCE.
Issue summary
- Issue opens: 04th February 2011
- Issue closes: 04th March 2011
Issue Structure:
- Maturity: The Bonds with a maturity of 10 years will be issued in Series I and II whereas Series III and IV will have a maturity of 15 years each.
- Face Value: Each Bond has face value of Rs 5,000 each.
- Minimum application: Rs 10,000 or 2 bonds. The bonds can be of the same series or 2 bonds across different series.
- Lock in: 5 years from the date of allotment.
- Buyback facility: Available for all the Bond Series.
Bond Issue Profile: (First Tranche)
| Options | Series I | Series II | Series III | Series IV |
| Interest Payment | Annual | Cumulative | Annual | Cumulative |
| Face Value
(Rs / Bond) |
Rs.1,000/- | Rs.1,000/- | Rs.1,000/- | Rs.1,000/- |
| Minimum Application | 5 Bonds and in multiples of 1 bond thereafter | |||
| Coupon (%) p.a. | 8.15% | 8.15% | 8.30% | 8.30% |
| Maturity | 10 years | 10 years | 15 years | 15 years |
| Redemption Amount per bond | Rs 1,000 per Bond + accrued interest * | Rs 2,189 | Rs 1,000 per Bond + accrued interest * | Rs 3,307 |
| Buy back Facility | Yes | Yes | Yes | Yes |
| Buy back date | 5 years | 5 years | 7 years | 7 years |
| Buy back intimation period | The period beginning not more than 9 months prior to the Buyback Date and ending not later than 6 months prior to the Buyback Date |
The period beginning not more than 9 months prior to the Buyback Date and ending not later than 6 months prior to the Buyback Date |
The period beginning not more than 9 months prior to the Buyback Date and ending not later than 6 months prior to the Buyback Date | The period beginning not more than 9 months prior to the Buyback Date and ending not later than 6 months prior to the Buyback Date |
| Buy back Amount (Rs) | Rs 1,000 per Bond + accrued interest * | Rs 1,480 per Bond | Rs 1,000 per Bond + accrued interest * | Rs 1,747 per bond |
l Calculated from the last interest payment date to the Buyback Date
Investors to benefit from 80 CCF Benefits:
- The Bonds are classified as “long term infrastructure bonds” and are being issued in terms of section 80 CCF of the Income Tax Act.
- Bonds offer an additional window of tax deduction of investments of up to Rs 20,000.
- The deduction is over and above the Rs 1,00,000 deduction available under section 80C, 80CCC & 80CCD read with section 80CCE
- It helps in intermediating the retail investor’s savings into infrastructure sector directly.
- In the event that any applicant applies for the bonds in excess of Rs 20,000 p.a., the aforestated tax benefit shall be available to such applicant only to the extent of Rs 20,000 p.a.
pl guide how to claim maturity proceeds of IIFCL bond ..series 2
Advise the maturity proceed of IIFCL bond series 2 issue in 2011. How can change add. and bank A/C
Advise the maturity proceed of IIFCL bond series 2 issue in 2011. How can change add. and bank A/C
Having IIFC BOND Purchased on Feb 2011
please guide to take maturity amount. what supporting documents attached and where physical bond deposit for repayment
Having IIFC BOND series -2
please guide us to take maturity amount. what supporting documents attached and where physical bond deposit for repayment
How to get the maturity proceeds of my IIFCL bonds 2011 series 2,please.
please guide us to take maturity amount Having IIFC BOND series -2
please guide us to take maturity amount
The bond are matured in 31march 2021
Having IIFC BOND series -2
please guide us to take maturity amountHaving IIFC BOND series -2
please guide us to take maturity amount
Having IIFC BOND series -2
please guide us to take maturity amount
Advise the maturity procedure of iifcl bonds series 2 issue in 2011.
How to encash IIFCL Bonds 2011 series 2
How to get the maturity proceeds of my IIFCL bonds 2011 series 2,please.
Mujhe band sell kerna he
Certificate no 2410
28-03-2011
How to get the maturity proceeds of my IIFCL bonds 2011 series 2,please.when do I get the answer?
How to encash IIFC Infra bonds series 2 taken in March 2010
Having IIFC BOND series -2
please guide us to take maturity amount. what supporting documents attached and where physical bond deposit for repayment
Please how I get redemption of my series 2.my folio no IFA0211332.
Having IIFC BOND series -2
please guide us to take maturity amount. what supporting documents attached and where physical bond deposit for repayment
Pl guide me proceeduer forms req for resumption maturity series 1&22010 2011 IFA0216669
Having IIFC BOND series -2
please guide us to take maturity amount