PUBLIC ISSUE OF UNSECURED REDEEMABLE NON CONVERTIBLE BONDS
UNDER SECTION 80CCF OF THE INCOME TAX ACT, 1961
FOR LONG TERM INFRASTRUCTURE BONDS
As you may be aware that in the last budget our Finance Minister has introduced a new IT Section 80CCF under which taxpayers can avail addition deduction of Rs.20,000/- by investing in long term Infrastructure Bonds. This investment is over and above the Rs. 1 lac permissible tax saving investment under section 80C.
IDFC Ltd is coming up with an Infrastructure bond issue of Rs 3,400 cr in one or more tranches. Issue is opening on September 30, 2010 and opening on October 18,2010. Find below the salient features and issue structure.
· First public issue of bonds by an infrastructure finance company under Sec 80 CCF
· Credit rating agency ICRA has rated the Bonds under this offer as "LAAA" with stable outlook, indicating highest safety.
· These bonds will be issued only to Resident Indian Individuals (Major) and HUF.
· The bonds are fully secured with first floating pari pasu charge over certain receivables of the Company and first fixed pari pasu charge over specified immovable properties 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 ranging between 7.5% and 8% p.a coupled with tax benefits of upto Rs 20,000 under Sec 80 CCF.
· There are 4 investment options, suiting the needs of different categories of investors.
· No TDS shall be deducted.
· The bonds will be listed on NSE & BSE and can be traded after the 5 year lock – in period.
· 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. The deduction is over and above the Rs 1,00,000 deduction available under section 80C, 80CCC & 80CCD read with section 80CCE.
| Series | I | II | III | IV |
| Frequency of Interest Payment | Annual | Cumulative | Annual (Buy Back) | Cumulative (Buy Back) |
| Face Value | 5000 | 5000 | 5000 | 5000 |
| Minimum Application | 10000 | 10000 | 10000 | 10000 |
| In Multiples of | 5000 | 5000 | 5000 | 5000 |
| Buy Back Option | No | No | Yes | Yes |
| Interest Payment | Yearly | Cumulative | Yearly | Cumulative |
| Interest Rate | 8.00% Per Annum | 8.00% to be compounded Annually | 7.50% Per Annum | 7.50% to be compounded Annually |
| Yield on Maturity | 8.00% | Compounded Annualy | 7.50% | Compounded Annualy |
| Buy Back Date | NA | NA | Date falling five years and one day from the Deemed Date of Allotment | Date falling five years and one day from the Deemed Date of Allotment |
| Buy Back Amount | NA | NA | At par with accured interest | At par with accured interest from the Deemed Date of Allotment |
| Maturity Date | 10 Years from the Deemed Date of Allotment | 10 Years from the Deemed Date of Allotment | 10 Years from the Deemed Date of Allotment | 10 Years from the Deemed Date of Allotment |
| Maturity Amount | At par plus accured interest | At par plus accured interest calculated from the Deemed Date of Allotment | At par plus accured interest | At par plus accured interest calculated from the Deemed Date of Allotment |
Cheque in the favour of: "IDFC Infra Bonds" through "Account Payee" crossed cheque only.
Please let me know the number of forms you all would be in need of….
For more details, Pls visit our near Branch
or call # +91 99822 54000 or mail @ deepaksrspl@gmail.com
Regards,
Research Department
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