Wednesday, 3 October 2012

Muthoot Finance NCD Doubles Your Money in 6 Years

Muthoot Finance, India’s Largest Gold Loan Company issues Non Convertible Debentures  (NCD) which doubles your money in 6 years. This is a public issue of Secured Redeemable NCDs with face value of Rs. 1000 per unit. The company wish to accumulate Rs. 250 Crores with an option  to retain over subscription up to Rs. 250 crores on issuance of additional NCD which aggregates Rs. 500 Crores. The company has 73 years heritage and with largest branch networks in gold loan Non Banking Finance Companies (NBFC). The investor is free to choose any of the 5 options of the NCD.

Options o f Muthoot Finance NCD

The first option is with tenure of 2 years with annual interest payment. The effective annual yield is 11.5% per annum.

The second option is with tenure of 3 years with annual interest payment. The effective annual yield is 11.75% per annum.

The third option is with tenure of 5 years with monthly interest payment. The effective annual yield is 12.40% per annum. Those who wishes to get a regular income, this option is suitable for them.

The fourth option is with tenure of 5 years with annual interest payment. The effective annual yield is 12% per annum.

The fifth option is with tenure of 6 years with cumulative interest payment at the time of redemption. The effective annual yield is 12.25% per annum.  With this option your investment will be doubled in 6 years.

Features of Muthoot Finance NCD

  1. Double your investment in 6 years (Option V)

  2. 12% per annum annual interest for 5 years NCD (Option IV)

  3. Monthly option Yield 12.4% (Option III)

  4. DeMat account is not necessary

  5. The NCDs are secured with gold in loan security.

  6. Issued opened on 17th September 2012

  7. Issue will be closed on 05th  October 2012

  8. Rating is ‘CRISIL AA -/ stable’ & ‘[ICRA] AA -/ stable’

  9. No TDS on interest payment. But the income from Muthoot finance NCD is taxable.


The allotment of NCD is first come first serve basis. Those who do not get the allotment will get the application money reimbursement with 11.5% per annum. The NCD seems attractive with the doubling option and other options are also beneficial. Those who wish to invest in the Muthoot Finance Non Convertible Debentures should read the legal disclaimer and prospectus carefully before investing.


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