Reliance Home Finance NCD December 2016 – offers 9.4%

Reliance Home Finance NCD Dec 2016 –  9.4%

Reliance Home Finance NCD Dec 2016 - Should you invest? 

Couple of months back, Indiabulls Home Finance Limited NCD issue offered 9.15% annualized yield.

Now it the turn for Reliance Home Finance NCD December 2016.

Reliance Home Finance NCD 2016 would open for subscription on 22nd December, 2016.

Reliance Home Finance Ltd NCD offers 9.4%. 

Reliance HFL’s latest NCD issue offers non-convertible debentures in the form of both Secured & non-Secured NCDs.

Reliance Home Finance NCDs – Issue Details & Features..!

Below are the few important details about Reliance HFL’s December 2016 NCD Issue;

• NCD Issue opening Date : 22nd December, 2016
• Issue Closes on : 6th January, 2017.
• Interest  Rate (Coupon Rate) on NCDs : The Rate Of Interest ranges from 8.70% to 9.40% depending on the category of investor and tenure of the NCDs.
• Issue Size: Base Issue size is Rs 1,000 cr (with an Option to retain over-subscription amount up to Rs. 3,000 Crores for Secured NCDs and upto Rs. 500 Crores for Un-Secured NCDs aggregating upto Rs. 3,500 Crores.)
• Mode of Issue : Physical & Demat forms
• Face Value (Issue Price): One NCD is Rs. 1,000
• Minimum Application size : Rs. 10,000 (10 NCDs) and in multiple of Rs. 1,000 thereafter
• Listing : The NCDs are proposed to be listed on BSE & NSE stock exchanges.
• Security & Asset  Cover : The Company and Promoter will create and maintain appropriate security in favour of the Debenture Trustee for the NCD Holders on the assets adequate to ensure 100% asset cover for the Secured NCDs. No security will be created for Un-Secured NCDs.
• Credit Ratings : Rating of ‘CARE AA+’ by CARE and ‘BWR AA+’ Outlook: Stable by Brickwork for Secured NCDs  and rating of ‘CARE AA’ by CARE and ‘BWR AA’ Outlook: Stable by Brickwork for Unsecured NCDs.
• Issue Allocation Ratio : 30% of the issue is for retail individual investors & 30% for High Net-worth Individuals (applying for an amount of > Rs. 10 lakh).
• NRIs are not eligible to apply for this issue.
• There is no PUT option available for Secured NCDs / Un-secured NCDs.
• Call option is not available for Secured NCDs. In case of Unsecured NCDs, Call option is available and can be exercised by the company after 10 years of from the date of allotment. If call option is not exercised, a step up of 0.25% (25 basis points) above coupon rate will be given.

Debentures and Taxation 

• TDS is not applicable on the listed debentures’ interest payouts (which are in Demat  form). Else, TDS will be applicable if the interest exceeds the threshold limit of Rs.5,000/- in a financial year.
• Interest earned on NCD bonds is taxable as per the tax slab of the investor.
• If you sell NCDs on stock exchange before one year from the date of purchase, Short Term Capital Gains Tax is applicable. Tax rates depend on the tax slab you fall into.
• If you sell NCDs on stock exchange before maturity but after one year, Long Term Capital Gains Tax (if any) at 10% without indexation is applicable.

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