Power Finance Corporation is coming up secured NCDs that would open for subscription on July 21, 2023. The interest rates are as high as 7.55%. It offers NCDs for 3 years, 10 years and 15 years tenure. These bonds come with good credit rating too. Should you invest in Power Finance Corporation NCD July 2023 issue? What are the risk factors one should consider before investing in such PFC NCD 2023?
Also Read: 5 Mutual Funds that turned 10K SIP between Rs 1.6 to Rs 1.9 Crores in 20 years
About Power Finance Corporation Limited
Power Finance Corporation is a public sector company that is a specialised financial instutition in power sector. With 20% market share, it is designated as nodal agency for development of Integrated power development scheme, ultra mega power projects etc.,
Power Finance Corporation NCD July-2023 – Issue details
PFC is issuing secured redeemable Non Convertible Debentures (NCD’s) in the Jul-2023 issue to the tune of Rs 500 Crores, with an option to retain another Rs 4,500 Crores towards over subscription, totaling to Rs 5,000 Crores. It comes with 3 different options with 3 years, 10 years and 15 years tenure.
| Opening Date | 21-Jul-23 |
| Closure date | 28-Jul-23 |
| Security Type | Secured, Redeemable and Non-Convertible NCDs |
| Issue Size (Base) | Rs 500 Crores |
| Option to retain oversubscription | Rs 4,500 Crores |
| Issue price | Rs 1,000 per bond |
| Face value | Rs 1,000 per bond |
| Minimum Lot size | 10 bonds and 1 bond there after |
| Tenure | 3, 10 and 15 yearas |
| Interest Payment frequency | Yearly |
| Listing on | Within 6 working days on BSE |
PFC NCD Prospectus July-2023
What is PFC NCD July 2023 Credit Rating?
These NCD bonds are rated by CARE/Crisil/ICRA as AAA: Stable, which indicates that instruments with this rating are considered to have a high degree of safety regarding timely servicing of financial obligations and carry a low credit risk.
What are the PFC NCD Interest Rates?
| Series | I | II | III |
|---|---|---|---|
| Frequency of Interest Payment | Annual | Annual | Annual |
| Tenure | 3 Years | 10 Years | 15 Years |
| Coupon (% per Annum) – Category I and II | 7.45% | 7.47% | 7.50% |
| Coupon (% per Annum) – Category IIII and IV | 7.50% | 7.53% | 7.55% |
| Effective Yield (% per Annum) – Category I and II | 7.44% | 7.46% | 7.49% |
| Effective Yield (% per Annum) – Category IIII and IV | 7.49% | 7.52% | 7.54% |
| Amount on Maturity (In Rs.) | 1,000 | 1,000 | 1,000 |
How is the company doing in terms of Financials?
Here is the financial performance based on consolidated numbers.
1) Its revenues have increased from Rs 54,105 Crores in FY2019 to Rs 77,568 Crores in FY2023.
2) Its profits have increased from Rs 12,596 Crores in FY2019 to Rs 21,178 Crores in FY2023.
Power Finance Corporation Non-Convertible Debentures Lead Manager
A.K. CAPITAL SERVICES LIMITED
603, 6th Floor, Windsor Off CST Road, Kalina Santacruz (East), Mumbai – 400 098 Maharashtra – Phone: +91 22 6754 6500;
Email: pfc.ncd2023@akgroup.co.in
Website: investor.grievance@akgroup.co.in
Power Finance Corporation Non Convertible Debentures Registrar
KFIN TECHNOLOGIES LIMITED
Selenium Tower B Plot 31-32, Gachibowli Financial District Nanakramguda Serilingampally, Hyderabad Rangareddi – 500 032 Telangana, India
Phone: +91 40 6716 2222; Email: pfcl.ncdipo@kfintech.com
Website: www.kfintech.com
Power Finance Corporation Contact Details
Power Finance Corporation Limited
“Urjanidhi”, 1, Barakhamba Lane, Connaught Place, New Delhi – 110 001
Phone: +91 11 2345 6000 ; Email: publicissue2324@pfcindia.com
Website: www.pfcindia.com
Why to invest in PFC NCD Jul-2023?
1) Company is a leading public sector power finance company in India.
2) Attractive interest rates where one can get interest rates upto 7.55%.
3) It is issuing secured NCD which are safe compared to other unsecured NCDs.
4) PFC NCD bonds have good credit rating of AAA Stable from CARE/ICRA/Crisil.
Why not to invest in PFC NCD Jul-2023?
1) It is issuing NCD bonds of 10 to 15 years, which are the long term. In case there is an increase in interest rates in the near future, investors might regret about it.
2) These NCD bond interest rates are inline with any other bank FD rates and not that exciting. Hence investors would not rush to invest in such NCD bonds.
3) You can refer all risk factors in the NCD prospectus.
Power Finance Corporation NCD July 2023 FAQs
1) What is the face value of PFC NCD Jul2023?
These NCD’s have face value of Rs 1,000 per bond. Investors need to apply for minimum of 10 bonds and 1 bond there after.
2) What is the frequency of interest paid in PFC NCD July 2023?
Interest on these NCDs are paid every year.
3) Can I redeem these NCD bonds from PFC before maturity?
No you cannot redeem these NCD bonds directly with PFC before maturity. However, you can sell these bonds on stock exchange. You might get lower or higher price depending on the demand about these bonds.
4) Is it safe to invest in PFC NCD 2023?
PFC is Maharatna company and owned and controlled by Ministry of Power, Govt of India. Hence the bonds issued by PFC are safe for investment.
5) Can I purchase these PFC NCD bonds on stock exchange after listing?
Yes. After listing, you can directly purchase these bonds too provided there are sellers available. The bond price again varies depending on the bonds that are on demand on that day.
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Should you invest in Power Finance Corporation NCDs July-2023 issue?
These PFC NCD Bonds offer interest rates up to 7.55% and have good credit rating too. It offers bonds for 3, 5 and 10 years tenure.
On the negative side, these bonds interest rates are inline with other major bank FD rates and not exciting. Investors who invest in these bonds can exit by selling them on stock exchange as these are listed bonds, however may get lower price.
If you are small investor, investing in simple bank FD can offer similar interest rate with easy liquidity. However if you are large investor and willing to invest huge lumpsum with safety of capital, you can invest in such bonds.
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Are these PFC NCDs tax free?
No. Interest is taxable
Sir which one is the best performing small cap fund?
Hello Raja, You can consider any of these funds. I am personally investing in these funds, hence suggesting the same.
1) Nippon India smallcap fund
2) Kotak Smallcap fund
3) Quant smallcap fund