Sunday, 24 October 2010

L&T Launched Infrastructure Bond which attracts Tax Exemption under Section 80CCF

L&T Infrastructure Finance Company Limited (L&T Infra) is a wholly owned subsidiary of Larsen & Toubro Limited. L&T Infra is a Non Banking Financial Company (NBFC) registered under Reserve Bank of India (RBI) Act 1934. The company has commenced operations in January 2007.It leverages L&T’s expertise in the infrastructure sector to offer turnkey financial solutions.

L&T Infra issues long term Infrastructure bond from 15th October, 2010 to 2nd November, 2010. This is also same as earlier infrastructure bonds and suitable for getting tax exemption under section 80CCF. Under Section 80CCF, one can invest in permissible infrastructure bonds and get an additional exemption of Rs. 20000.

Buy Back Option and Maturity option

Similar to the previous long term infrastructure bond issues L &T issue will also have a maturity period of 10 years and a lock in period of 5 years. This issue will also have 4 options but little different than IDFC issue.

For Ten years bond there is an 8% interest in cumulative and noncumulative option.

But Buy back option will be available two times once after 5 years and after 7 years. Buy back option after 5 years with annual interest payment, Buy back option after 5 years with cumulative interest, Buy back option after 7 years with annual interest payment and buy back after 7 years with cumulative interest. But the interest rate has a slight difference for 5 years and 7 years. For 5 years the interest rate is 7.5% and for 7 years it is 7.75%. For annual interest payment the interest will be credited in your bank account directly.

Face value of each bond is Rs. 1000. ICRA has assigned a credit rating of LAA+ and CARE has assigned CARE AA+ ratings to the issue, which indicates a stable outlook.

Demat account is not compulsory

You can approach State Bank of India, HDFC Bank Limited, IDBI Bank Limited, ICICI Bank Limited, ING Vysya Bank Limited, Axis Bank Limed, DBS Bank Limited and HSBC Bank for applying the Infrastructure bond. Through these banks you can buy this infrastructure bond in physical form. For purchasing in physical form there is no need to have a demat account. The main advantage of this bond is that demat account is not compulsory for purchasing L&T Infrastructure bond.

If you have an online trading account with Kotak Securities Limited, SHCIL Services Limited, RR Equity Brokers Private Limited, IDBI Capital Market, Services Limited, Anand Rathi Share & Stock Brokers Limited, SMC Global Securities Limited, A. K. Stockmart (P) Limited, HDFC Securities Limited, Reliance Securities Limited, Enam Securities Private Limited, Standard Chartered-STCI capital Markets Limited, Edelweiss Securities Limited, Almondz Global Securities Limited and Eastern Financiers Limited you can apply for the issue online the bonds once allotted will be credited to your demat account in dematerialized form.

Tax Exemption

According to your tax slab you will get an exemption of tax amount of Rs. 2060, Rs. 4120 & 6180 respectively for the tax slabs of 10%, 20% and 30% for the deposit of Rs. 20000 in this infrastructure bond.

This is a good option for tax savings and better for 20% and 30% tax brackets and facility of deposit without a demat account is eliminating the main disadvantages of  bonds under section 80ccf.

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11 comments :

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  5. Hi there :D Is it alright that I go a bit off topic? I am trying to view your site on my iPod Touch but it doesn't display properly, do you have any suggestions? Thanks! Magnolia x :)

    ReplyDelete
  6. If i purchase Infrastuture bond from HDFC Bank,If possible to transfer to other bankAccount?

    ReplyDelete
  7. [...] The company has got an encouraging response from thier investors. The company is offering a coupon rate of 7.5% on the bond. With a 7-year put option, on completion of five years, the bond offers a coupon rate of 7.75%. More about L&T Infra Bond [...]

    ReplyDelete
  8. i wan to purchase how can i my contact 9002954613

    ReplyDelete
  9. I am not sure where do you stay. Just visit any bajaj capital branch or contact them. You can search form the web that which branch is near to you.

    ReplyDelete
  10. EXTRA TAX SAVING 20,000 BY L&T INFRA BOND,NOW OPEN. TO AVAIL PL.CONT.
    A.K. SINGH ON
    PH.011-22482985
    M. 9311099558.
    FOR DOOR STEP SERVICE

    ReplyDelete
  11. hi everyone,
    we ARE mumbai based, if you want to apply in L&T INFRA BOND, THAN YOU CAN
    CALL US FOR DOORSTEP SERVICE.

    CONT +91 22 6417 4884
    +91 98217 69549

    ReplyDelete