Issue Highlights:
- Issue of Tax Free Secured Redeemable Non Convertible Bonds
- Issue Size: Rs 1,000 Crore with an option to retain oversubscription upto Rs 4,500 Crore
- Additional Coupon Rate - Category-IV Applicants - 0.50% p.a.
- REC is one of only 16 Indian PSUs granted "Navratna" status
- 66.80% shareholding held by Govt. of India as on 31 Sep 2012
- When Bonds held by the original allottees of Category IV are sold / transferred, coupon rate will be revised to the coupon rate for Category I, II & III investors. Refer to details.
- Application cannot be made by Non-resident Indians and Foreign nationals.
Key Benefits:- The income from interest on these Bonds is fully exempt from Income Tax and no TDS is applicable.
- Wealth Tax is not levied on investment in bonds under section 2(ea) of the Wealth-tax Act, 1957.
- Credit Ratings indicating highest safety: AAA by CARE and ICRA, AAA/Stable by CRISIL.
- The Bonds shall be listed and can be traded on BSE and NSE.
- No upper limit on investment amount.
- No lock in period for the Bonds.
Terms of the Issue:
| Particulars | Issue Details | | Face Value per Bond | Rs 1,000 | | Tenor | 10 years | 15 years | | Minimum Application | Rs 5,000 (in multiples of Rs 1,000 thereafter) | | Coupon Rate % p.a. (Category I, II and III) | 7.22 | 7.38 | | Additional Coupon Rate % p.a. (Category IV) | 0.50 | 0.50 | | Total Coupon Rate % p.a. (Category IV) | 7.72 | 7.88 | | Effective yield % p.a. (Category I, II and III) | 7.22 | 7.38 | | Effective yield % p.a. (Category IV) | 7.72 | 7.88 | Frequency of Interest payment
(Paid on 1st December) | Annual | Annual | | Issuance | Physical and Demat mode | | Interest on application % p.a. | As per coupon rate applicable to investor category | | Interest on refund % p.a. | 5.00 | | Redemption Date | 10 years from Deemed Date of Allotment | 15 years from Deemed Date of Allotment | | Redemption Amount | Repayment of the face value with interest |
Issue Structure:
| Investor Category | I - Institutional | II - Non Institutional | III - HNI (more than 10 lacs) | IV - Retail (upto and including 10 lacs) | | Issue allocation | 15% | 15% | 40% | 40% | | *Basis of allotment: on first come first serve basis |
* For the purpose of information only, invest only after referring to the final prospectus. |
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