SREI
Infrastructure Finance has come out with public issue of
non-convertible debentures (NCD) offering up to 10% interest rate. The issue
opens on September 7 and closes on September 28, 2016.
SREI
Infra Finance is primarily into financing of infrastructure projects along with
advisory.
SREI Infra Finance NCD – Key Points:
· Offer
Period - September 7 – 28, 2016
· Annual
Interest Rates for Retail Investors- 9% to 10% depending
on tenure
· Price of
each bond- Rs. 1,000
· Minimum
Investment- 10 Bonds (Rs. 10,000)
· Max
Investment Limit for Retail Investor- Rs. 10 Lakhs
· Credit
Rating- “BWR AA+” (Outlook Stable) by “BRICKWORK”
· NCD Size: Rs.
250 crore with option to retain oversubscription of Rs. 1000 crore
· Allotment- First
Come First Serve
· Listing: Bond
- would be listed on BSE and NEX
and will entail capital gains tax on exit through secondary market
How to Apply?
If you
have Demat account apply through that or / ASBA facility provided by banks.
It’s
the easiest way to apply and also avoids a lot of hassle in terms of KYC and
paper work
Who can Apply?
This
issue is open to all Indian residents, HUFs and Institutions.
· Category
I – Institutional Investors – 20% of the issue is reserved
· Category
II – Non-Institutional Investors, Corporates – 20% of the issue is reserved
· Category
III – Retail Individual Investors including HUFs – 60% of the issue is reserved
However
NRIs cannot apply for this NCD.
Why you should invest?
1. The NCD
is secured, which means the above debt is backed by assets of the company
2. The interest rates are about to 2%-3% higher
than your regular Bank FDs
3. No TDS if
invested in Demat Form
Why you should not invest?
1. Infrastructure
Financing is risky business as the success depends on timely and successful
completion of the project. In India, there are a lot of infrastructure projects
struck at various stages for various reasons.
2. The
NPA is 3.54% which is bad
3. The
profits of the company declined in last few years
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