5 Tax free bonds to invest in 2013 – Issue open now


Tax free bonds to invest in 20135 Tax free bonds to invest in 2013 – Issue open now

While the first tranche tax free bonds was issued by IRFC,HUDCO and IIFCL in Jan-13, the second tranche tax free bonds are open now. Some more companies joined in this band wagon of issuing tax free bonds now in 2013. Currently there are 5 companies which are offering tax free bonds in India where investors can invest for long term.

  1. IRFC Tax free bonds
  2. HUDCO Tax free bonds
  3. IIFCL Tax free bonds
  4. PFC tax free bonds
  5. REC tax free bonds

1) IRFC tax free bonds

Indian Railway Finance Corporation Ltd , a Govt. of India enterprise is a dedicated financing arm of Ministry of Railways. Its sole objective is to raise money from market and finance Indian Railways.  IRFC issuing tax free bonds for 2013. The proposed issue is for Rs 1,000 Crores to retain additional subscription up to Rs 3,513.01 Crores.

Details about IRFC tax free bonds issue

  • Date of open: 25-Feb-2013
  • Date of closure: 13-Mar-2013
  • Face value : Rs 1,000 per bond
  • Min subscription: 5 bonds i.e. Rs 5,000 and multiples of 1 bond thereon
  • There are 2 series of tax free bonds. Series-1 for 10 years; Series-2 for 15 years
  • Interest rates are as follows:

             Tenure     Interest-Individuals       Interest for Banks/HNI’s

10 years       7.38                                6.88

15 years       7.54                                7.04

  • Crisil, ICRA and CARE have rated this issue as AAA which states as high safety regarding timely serving of the financial obligations.

2) HUDCO tax free bonds

HUDCO is a public sector enterprise which provides long term finance for the housing development projects. Housing Urban Development Corporation is proposing to issue tax free bonds for Rs 500 Crores with an option to retain oversubscription up to Rs 2,805 Crores.

Details about HUDCO tax free bonds issue

  • Date of open: 21-Feb-2013
  • Date of closure: 15-Mar-2013
  • Face value : Rs 1,000 per bond
  • Min subscription: 5 bonds i.e. Rs 5,000 and multiples of 1 bond thereon
  • There are 2 series of tax free bonds. Series-1 for 10 years; Series-2 for 15 years
  • Interest rates are as follows:

           Tenure     Interest-Individuals        Interest for Banks/HNI’s

10 years         7.53                                       7.03

15 years         7.69                                       7.19

  • Crisil and India Ratings and Research Pvt. Ltd have rated this issue as AA+ which states as high safety regarding timely serving of the financial obligations.

3) IIFCL tax free bonds

IIFCL is the government enterprise which is established in 2006 with an objective of providing finance solutions for world class infrastructure in India. India Infrastructure Finance Company Ltd (IIFCL) is proposing to issue tax free bonds for Rs 200 Crores with an option to retain oversubscription up to Rs 6,331 Crores.

Details about current tax free bonds issue

  • Date of open: 25-Feb-2013
  • Date of closure: 15-Mar-2013
  • Face value : Rs 1,000 per bond
  • Min subscription: 5 bonds i.e. Rs 5,000
  • There are 3 series of tax free bonds. Series-1 for 10 years; Series-2 for 15 years; Series-3 for 20 years.
  • Interest rates are as follows:

            Tenure     Interest-Individuals   Interest for Banks/HNI’s

10 years              7.36                  6.86

15 years              7.52                  7.02

20 years              7.58                  7.08

  • Crisil and ICRA have rated this issue as AAA which states as high safety of investment.

4) Power Finance Corporation (PFC) tax free bonds

PFC is proposing to issue tax free bonds for Rs 100 Crores with an option to retain oversubscription up to Rs 3,890 Crores.

Details about current tax free bonds issue

  • Date of open: 18-Feb-2013
  • Date of closure: 15-Mar-2013
  • Face value : Rs 1,000 per bond
  • Min subscription: 5 bonds i.e. Rs 5,000
  • There are 3 series of tax free bonds. Series-1 for 10 years; Series-2 for 15 years
  • Interest rates are as follows:

             Tenure     Interest-Individuals   Interest for Banks/HNI’s

10 years            7.38                        6.88

15 years           7.54                         7.04

  • Crisil rated this issue as AAA/Stable while ICRA and CARE have rated this issue as AAA which states as high safety of investment.

5) Rural Electrification Corporation (REC) tax free bonds for 2013

REC is proposing to issue tax free bonds for Rs 100 Crores with an option to retain oversubscription up to Rs 2,482 Crores.

Details about current tax free bonds issue

  • Date of open: 25-Feb-2013
  • Date of closure: 15-Mar-2013
  • Face value : Rs 1,000 per bond
  • Min subscription: 5 bonds i.e. Rs 5,000
  • There are 3 series of tax free bonds. Series-1 for 10 years; Series-2 for 15 years
  • Interest rates are as follows:

Tenure        Interest-Individuals   Interest for Banks/HNI’s

10 years         7.38                             6.88

15 years         7.54                             7.04

  • Crisil, ICRA and CARE have rated this issue as AAA which states as high safety of investment.

Comparison of these 5 Tax Free Bonds

Comparison of tax free bonds-Feb-2013

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Suresh
5 Tax free bonds to invest in 2013


There are 13 comments left Go To Comment

  1. umesh /

     i am south indias NO.1 lic agent I am sience 25 years in inv. & ins. field with BIG client BASE U R well come to join for mutule prosperty 

    regards 

    UMESH
     

  2. Amitabh /

    Dear Suresh, 
    Which are the best tax-free bonds in the private sector? I have invested in Aviva Live Smart which has amongst 7 areas a Tax Bond area. Which are the other such options ?

    1. Suresh / Post Author

      Amitabh, there are no tax free bonds in private sector. In case you are refering debenture bonds (since they use such naming conventions), the returns are taxable.

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