Should You Invest? Indiabulls Housing Finance Releases NCDs with 10.75{e576653dfa42e7ed55958086470380e0158fb4bb779b4a72dd274eee05b9584b} Interest Rate
Indiabulls Housing Finance has initiated the public issuance of secured redeemable non-convertible debentures (NCDs) with a coupon rate of up to 10.75 percent per annum. This marks Tranche VI of their NCD offerings, with a minimum investment amount set at ₹10,000.
Here’s a comprehensive breakdown of these investment instruments for potential investors:
Understanding Non-Convertible Debentures: Non-Convertible Debentures (NCDs) are fixed-income securities issued by companies through a public offering to secure long-term capital. They boast attractive interest rates compared to convertible debentures.
Various Investment Tenures Available: Investors have the flexibility to select from different investment tenures, ranging from 24 months to 120 months, with allotment based on a first-come-first-serve basis.
Diverse Investment Options: Investment tenures encompass monthly, annual, and cumulative options, catering to varied investor preferences.
Credit Rating and Safety Assurance: The NCDs hold a credit rating of AA/Stable by Crisil and ICRA, signifying a high degree of safety in servicing debt obligations. According to Crisil Ratings, AA-rated issuers are deemed to carry minimal credit risk.
Total Issue Value: Indiabulls Housing Finance has unveiled a public issue worth ₹100 crore, with a green shoe option of ₹100 crore, aggregating up to ₹200 crore under Tranche VI Prospectus. The issuance period commenced on May 13 and will conclude on May 27.
Considerations for Investment: While corporate debt instruments offer higher interest rates, they inherently entail higher risk compared to safer alternatives like bank fixed deposits (FDs). As a result, it’s generally advisable to opt for AAA-rated instruments for safer investment avenues.
Risk Factors to Consider: The Prospectus outlines various risk factors, including the susceptibility to interest rate volatility, potential interest rate and maturity mismatches between assets and liabilities, which could lead to liquidity challenges in the future.
