Friday, December 23, 2011

NHAI Tax Free Bonds

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NHAI (National Highways Authority of India ) has come out with their tax free secured redeemable non convertible bonds public issue with a face value of Rs 1000 per bond. Investors will get tax benefits u/s 10 clause (15) of the Income Tax Act, 1961 – the interest received on such bonds are tax free in nature.

The issue opens on 28th December, 2011 and closes on 11th January, 2012.

Investors can earn 8.20% interest rate for 10 years which translates to 11.88% pre-tax yield. Investors willing to invest for 15 years can earn 8.30% interest rate which translates to 12.03% pre-tax yield.

The issue have been rated AAA (stable) from CRISIL and AAA (stable) from ICRA.

The minimum investment for this issue is 50 bonds or Rs 50,000 and in multiples of 1 bond or Rs 1000 thereafter. Bonds will be allotted on first-cum-first serve basis up to the issue size of relevant tranches. Bonds are likely to be issued either in Demat form or physical form at the option of bondholders.

NHAI Tax Free Bonds would get listed on the Bombay Stock Exchange and the National Stock Exchange.
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  1. National Highways Authority of India's (NHAI) first sale of retail bonds has received bids for nearly five times the base amount so far, capitalising on investors' appetite for safe havens as the global debt crisis keeps domestic equity markets lacklustre.