NHAI, an autonomous body of Govt. of India under the Ministry of Road, Transport & Highways is offering a Secured, redeemable, non-convertible debentures with tax benefits under The Income Tax Act, 1961. The issue opens on December 28, 2011 and closes on January 11, 2012.

The bonds are rated “AAA” by CRISIL, CARE & FITCH. The Interest Income on the Bonds is tax-free in nature. The bond offers various modes of Interest payment and also offers the options of issuing either in Demat or physical form. NRIs can apply on repatriable and  non repatriable basis. The bonds will be listed on NSE & BSE

More details:

We have seen the basics about Bank Fixed Deposits (FDs) earlier. Corporate Fixed Deposits give a higher return than the Bank FDs but are also unsecured. You need to see the credit rating of the company before investing for higher returns.

Let's start with the benefits of Investing in Corporate Fixed Deposit. The benefits are:

• Fixed Return on investment
• Relatively Safe return on Investment
• No Income Tax is deducted at source if the interest income is up to Rs 5,000 in one financial year
• Investment can be spread in more than one company, so that interest from one company does not exceed Rs. 5,000.

List of Fixed Deposit available:

Muthoot Finance Ltd. is one of the oldest and largest gold financing company in India as the Gold Loan business was started in 1939. Muthoot Finance is coming out with a public issue of Non Convertible Debentures  from today, i.e., 22^nd December, 2011 for an issue size aggregating up to Rs 600 crore. Read what is a NCD?

There are 4 options that depends on the term of the debentures. The term ranges from 2 years to 5-1/2 years. For the 5-1/2 year debenture, Muthoot Finance offers 13.43% effective yield while for the 2 year debenture, it is 13%.

Issue Details:

Muthoot Finance Ltd is offering a Non Convertible Debenture (NCD) with a yield of +13% from tomorrow, i.e. 22nd December, 2011. Before we detail the Muthoot NCD issue, let's understand what is a NVD. Non-convertible Debentures / Bonds are debt instruments with a fixed tenure issued by companies to raise funds from the market for business purposes. Unlike convertible debentures, NCDs cannot be converted into equity shares of the issuing company at a future date. Hence, the return offered by them is relatively higher than convertible debentures. The issuing company pays a fixed rate of interest for the pre-defined period.

The interest is paid at different time periods, say, quarterly, semi-annually and annually. Some debentures also have cumulative option i.e. interest on them is cumulated and paid on maturity. These debentures can be redeemed after a specified time period so the amount invested, which is equal to the face value, will be returned to the investor. These are the good investment option for people who are looking beyond the fixed deposits and other small savings instruments or for those who want to create a diversified debt portfolio by investing in different instruments.