10.75% ROI with Indiabulls NCDs: A Wise Investment Choice
In today's ever-changing investment landscape, securing your financial future is paramount. One investment avenue that has gained considerable attention is the Non-Convertible Debentures (NCDs) offered by Indiabulls Housing Finance Limited. In this article, we will delve into the details of this investment option, which can be a valuable addition to your portfolio.
Company Overview
Indiabulls Housing Finance Limited, established in 2005, has emerged as one of India's largest housing finance companies. It proudly serves as the flagship entity of the Indiabulls Group, providing a wide array of services such as Home Loans, Home Renovation Loans, Rural Home Loans, and Home Extension Loans.
As of September 30, 2022, the company boasts an extensive network of 164 branches across India, ensuring a nationwide presence for customer interaction and service. Additionally, the company employs a dedicated sales team of 2,200 professionals throughout its network.
Indiabulls Housing Finance Limited holds a strong long-term credit rating of "AA; Outlook Stable" from CRISIL and ICRA, along with a "AA; Outlook Negative" rating from CARE Ratings. Its non-convertible debentures and subordinated debt program have earned a "AA+; Outlook Stable" rating from Brickwork Ratings.
Indiabulls NCD Issue Details
Here's a quick summary of the essential details concerning the Indiabulls Housing Finance Limited NCD:
Issuer : Indiabulls Housing Finance Limited Tranche II Issue
Instrument: Secured Redeemable Non-Convertible Debentures (NCDs)
Issue Opens: Wednesday, September 6, 2023
Issue Closes:Wednesday, September 20, 2023
Issue Size: Rs. 100 Crore with an option to retain oversubscription up to Rs. 100 Crore, aggregating up to Rs. 200 Crore
Issue Price / Face Value: Rs. 1,000/- per NCD
Minimum Application: Rs. 10,000/- (10 NCD) and in multiples of Rs. 1,000/- (1 NCD) thereafter
Credit Rating: "CRISIL AA/Stable" by CRISIL Ratings Limited and "[ICRA] AA (Stable)" by ICRA Limited
Registrar: KFIN Technologies Limited
Listing: The NCDs are proposed to be listed on BSE
Category Allocation
The NCDs are distributed across four segments with specific allocations:
Category I - Institutional: 30%
Category II - Non-Institutional: 10%
Category III - HNI: 30%
Category IV - Retail: 30%
Series-Specific Terms
Indiabulls Housing Finance Limited offers various series of NCDs, each with distinct tenors and coupon rates. Below is a table detailing the specific terms for each series:
| Series |
Frequency |
Tenor |
Coupon (%) for Category I & II |
Coupon (%) for Category III & IV |
Effective Yield (%) for Category I & II |
Effective Yield (%) for Category III & IV |
Redemption Amount (₹ / NCD) on Maturity for Category I & II |
Redemption Amount (₹ / NCD) on Maturity for Category III & IV |
| I |
Annual |
24 Months |
9.25% |
9.65% |
9.24% |
9.64% |
Rs.1,000 |
Rs.1,000 |
| II |
Monthly |
24 Months |
8.88% |
9.25% |
9.24% |
9.64% |
Rs.1,000 |
Rs.1,000 |
| III |
Cumulative |
24 Months |
NA |
NA |
9.25% |
9.65% |
Rs.1,193.85 |
Rs.1,202.65 |
| IV* |
Annual |
36 Months |
9.40% |
9.90% |
9.39% |
9.88% |
Staggered Redemption over 3 years |
Staggered Redemption over 2 years |
| V |
Monthly |
36 Months |
9.02% |
9.48% |
9.39% |
9.89% |
Staggered Redemption over 3 years |
Staggered Redemption over 2 years |
| VI |
Cumulative |
36 Months |
NA |
NA |
9.40% |
9.90% |
Staggered Redemption over 5 years |
Staggered Redemption over 5 years |
| VII |
Annual |
60 Months |
9.65% |
10.15% |
9.64% |
10.14% |
Rs.1,309.70 |
Rs.1,327.75 |
| VIII |
Monthly |
60 Months |
9.25% |
9.71% |
9.64% |
10.14% |
Staggered Redemption over 7 years |
Staggered Redemption over 7 years |
| IX |
Annual |
84 Months |
10.00% |
10.50% |
9.99% |
10.49% |
Staggered Redemption over 10 years |
Staggered Redemption over 10 years |
| X |
Monthly |
84 Months |
9.57% |
10.03% |
9.99% |
10.49% |
Staggered Redemption over 10 years |
Staggered Redemption over 10 years |
| XI |
Annual |
120 Months |
10.25% |
10.75% |
10.24% |
10.74% |
Staggered Redemption over 10 years |
Staggered Redemption over 10 years |
| XII |
Monthly |
120 Months |
9.80% |
10.25% |
10.24% |
10.74% |
Staggered Redemption over 10 years |
Staggered Redemption over 10 years |
Conclusion
Indiabulls NCDs present a compelling investment opportunity for both individuals and institutions. With a solid credit rating and a range of series to choose from, investors can customize their investments to align with their financial objectives and risk tolerance. However, it is advisable to conduct thorough research and consult financial experts before making any investment decisions to ensure that these NCDs harmonize with your overall investment strategy.