Monday, 12 December 2011

New IFCI Infrastructure bond with 9.09% & 9.16%

IFCI (Industrial Finance Corporation of India) issued new infrastructure bond with 9.09 percent & 9.16 percent interest. The new infrastructure bond is its 4th series of bonds which gives the income tax benefit under section 80 CCF. (Section 80  CCF allows additional income tax exemption for Rs. 20000 other than Rs. 100000 under section 80C of income tax act). The date of issue of the bond is 30th November, 2011 and the closing date is 16th January, 2011. The IFCI infrastructure bond – series 4 is in 2 types as per the maturity period. These bonds are   for individual and HUF investors only.

Face value of Infrastructure bond: Face value of one single IDFC infrastructure bond is Rs. 5000 and theminimum required investment is also Rs. 5000 and multiples of Rs. 5000 thereafter for additional investment.

Maturity period & Date of Maturity: The maturity period of New IFCI infrastructure bond is 10 years and 15 years and the date of maturity is 15th December, 2022 & 15th December, 2027 respectively for 10 years and 15 years infrastructure bond. But in each case the lock in period is only 5 years from the date of allotment which is expected on 15th February, 2012.

Interest payment and rate of interest: The 10 years IFCI infrastructure bonds offer 9.09% interest and for 15 years the rate of interest is 9.16% per annum. Bonds of 10 years and 15 years are available in both cumulative option and annual interest payout option.

Buy Back Option: IFCI infrastructure bond offer buy back option also. The investor can redeem the bond on buy back period. The 10 years bond offer a buy back option at the end of 5th year and 7th year of allotment and the 15 years bond offer buy back option at the end of 5th year and 10th year of allotment. The buyback dates are 15th February, 2017 & 2019 for 10 years bond and 15th February, 2017 and 2022 for 15 years bond.

Listing & Mode of issue: The New IFCI infrastructure bond is in dematerialized form and physical form. Those who have a deamt account can buy the bond through deamt account and can sell it through your demat account. Bond will list in Bombay stock exchange and one can trade it after 5 years lock in period. The bond issued in physical form can sell only in physical form and can redeem at the maturity or buy back period.

Interest payment and Redemption: Payment of  interest and redemption is through ECS or post dated cheques or through demand drafts.

IFCI infrastructure bond offers more interest than the recently issued IDFC infrastructure bond which offers only 9% interest. We hope that people welcome this infrastructure bond wholeheartedly, because the last quarter of the financial is very near and an investment of Rs. 20000 in infrastructure bonds helps to save a tax of Rs. 2060 for 10% tax brackets, Rs. 4120 for 20% tax brackets and Rs. 6180 for 30% tax brackets in addition to interest of infrastructure bond.

New IFCI Infrastructure bond


Related post

Additional Rs. 20000 exemption under section 80CCF

New IDFC infrastructure bond with 9% interest

 

5 comments :

  1. Yes IFCI infrastructure bond gives more interest.

    ReplyDelete
  2. Yes IFCI is a good avenue to save tax, also there is Buy Back Option available. The Issue closes on 16th Jan 2012.

    ReplyDelete
  3. I want to invest in IFCI Infrastructure bond. Could you please help me on the following queries?

    1. If I go with option 4, i.e. for 15 year Annual (9.16%) interest rate; Interest will get created every year by 9.16%?
    2. For the above option if I take back money after 5 year? How much deduction will happen? Can I get my all principle amount back?
    a. If Yes then everyone will try for 15 years option only right and they will withdraw after 5 year, by taking more interest.. Right? Please clarify the same.

    ReplyDelete
  4. I want to invest in The bond. give me help.

    ReplyDelete
  5. 1. Yes you will get interest rate of 9.16% per anum for 15 years
    2. In buy back option of 5 or 7 years they will not give you interest rate of 9.16 % per anum. If you opt to surrender your bond after 5 or 7 years they will again calculate your interest rate at a prefixed rate & deduct the excess interest paid to you from your principal. In such cases they may give you normal bank saving interest of 4 to 6% per anum
    3. Clarified in point no 2.

    ReplyDelete