HUDCO is coming up with a Tax-Free Bond Issue, which would open for subscription from Friday, January 27, 2012


Issue Size and Credit Ratings:
The issue size of the bond issue would be Rs. 4,684.72 crores and the issue has been rated by CARE and Fitch. Fitch Ratings has given a rating of Fitch AA+ and CARE AA+ by CARE, which is one notch below the maximum rating

Face Value and Minimum Investment
The Face Value of each bond would be Rs.1,000/- and the minimum investment would be Rs.10,000/- and in multiples of Rs.1,000/- thereafter. The income by way of interest on these Bonds is fully exempt from Income Tax and shall not form part of Total Income as per provisions under Section 10 (15) of IT Act. Moreover, there will be no deduction of tax at source from the interest, which accrues to the bondholders on these bonds irrespective of the amount of the interest or the status of the investors

Interest Rate and options available:

Indian Railway Finance Corporation Limited (IRFC) has proposed to issue Tax Free Bonds to raise money from the market to finance the outlay of Indian Railways.

The income by way of interest on these Bonds is fully exempt from Income Tax and shall not form part of Total Income as per provisions under Section 10 (15) of IT Act. Moreover, there will be no deduction of tax at source from the interest, which accrues to the bondholders on these bonds irrespective of the amount of the interest or the status of the investors

IRFC is the financing arm of the Indian Railways and a Public Financial Institution under Section 4A of the Companies Act, 1956, which is fully held by Government of India

Click here for complete details on IRFC Tax Free Bonds