Are you seeking information regarding much-talked-about non-convertible debentures? If you are? Then surely you are landed at the right place.
With the help of this post, I will provide you complete detail of NCD (Non-convertible debentures).
With the help of this post, I will provide you complete detail of NCD (Non-convertible debentures).
Non Convertible Debentures (NCDs)
Investors want investment options that manage liquidity and risks while offering substantial returns. Debentures are long-term financial instruments issued by a company for specified tenure with a promise to pay fixed interest to the investor. Debentures are of two types, namely convertible debentures and non-convertible debentures (NCD). Non-convertible debentures (NCD) are those which cannot be converted into shares or equities. NCD interest rates depend on the company issuing the NCD.
NCD investment can be held by individuals, banking companies, primary dealers other corporate bodies registered or incorporated in India, and unincorporated bodies.
List Of Upcoming & Ongoing NCDs
| Upcoming & Ongoing NCDs | Issue Size | Issues Dates |
|---|---|---|
| IIFL Home Finance | 100 Cr. | 06 Jul 2021 - 28 Jul 2021 |
| Muthoot Fincorp LTD | 150 Cr. | 18 Feb 2021 - 09 Mar 2021 |
| Muthoot Fincorp LTD | 200 Cr. | 31 Dec 2020 - 25 Jan 2021 |
| Kosamattam Finance LTD | 175 Cr. | 23 Dec 2020 - 19 Jan 2021 |
| Edelweiss Financial Services | 100 Cr. | 23 Dec 2020 - 15 Jan 2021 |
| Muthoot Finance | 100 Cr. | 11 Dec 2020 - 05 Jan 2021 |
Advantages of investing in NCD
If you are seeking who should invest and what are benefits you can gain, then please read the following- These are considered a great option if you are looking for a constant stream of income. Few NCDs offer you to return interest and the principal amount at the maturity itself. Hence in such a case, they act like typical FDs
- Usually, provide a higher rate of returns as compared to Bank FDs.
- These NCD are listed in stock exchanges. In case of liquidity, you can sell it in the secondary market
- Interest will be credited to your bank account. Hence, ease of managing money
- There will be no tax deduction at source for these NCDs if you held them in the Demat format
- It will give diversification to your debt portfolio.
Disadvantages of NCD
- Never trust the credit rating and jump into investing
- They are rarely traded even after listed in the secondary market like BSE or NSE. You may face the liquidity issue
- Always check for the post-tax returns
- Higher interest means a higher the amount of risk
