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10.80% Muthoot Finance NCD Issue March2015:


 

Muthoot Finance – Largest gold loan company has come up with an issue of non-convertible debentures – NCDs which will open on March 25, 2015.Muthoot finance will raise Rs.300 crore through this issue.Issue offers different options like – Monthly Interest payment, Annual interest payment and cumulative.

Muthoot finance offers personal as well business loan backed by security of Gold jewellery.Currently muthoot finance have gold loan market share of 20% and company’s outstanding Gold loan under management stands more than 21,000 Crore.

Imp Dates:

  1. Issue Open Date:March 25, 2015
  2. Issue Close Date:April 27, 2015.

Security :

Issue have both secured and Un-secured NCDs.Cumulative NCDs of tenure 81 months are of Un-secured nature and will be treated asTier – II capital.company will not create any charge for unsecured NCDs.While Secured NCDs will be secured through charge on idenfied movable assets and future receivables of company.

Credit Rating : AA- by ICRA indicates stable issue.

Different Options : Monthly interest, Annual Interest and Cumulative.

Monthly Interest Option :

Interest will be paid monthly to investors.

WWW.SAVING-IDEAS.COM MUTHOOT FINANCE NCD MARCH2015 MONTHLY INTEREST OPTION

Annual Interest Payment Option:

WWW.SAVING-IDEAS.COM - MUTHOT FINANCE NCD MARCH 2015 ANNUAL INTEREST OPTION

Cumulative interest option:

WWW.SAVING-IDEAS.COM MUTHOOT FINANCE NCD MARCH 2014 CUMULATIVE

81 MONTH Unsecured cumulative Option:

MUTHOOT FINANCENCD MARCH 2015 UNSECURED NCD 81 MONTHS

Company’s profit after depreciation and Tax:

dyerware.com

Being Gold loan company,external factors like gold rate, currency or RBI regulations can affect company’s performance.As per current regulation Gold loan company can offer loan up to 75% of value which provide allowance for company against immediate fall in Gold rates.One can invest in this issue but should be aware of commensurate credit risk.

How Dividend Option Affects Your Returns In Long Term:

Generally, any mutual fund scheme have two options – Growth and  dividend. Fund distributes some income in form of dividend to its investor, if opted . But any investor who have regular income should opt for dividend option. Answer is “no” as after dividend is distributed NAV drops up to extent of dividend paid.

This NAV drop affects compounding effect in long term. Here is comparison of NAVs of Growth and Dividend options of few older schemes .

Scheme list is arbitrary and Initial or starting NAV of all schemes is 10.

 

DVIDEND Vs GROWTH OPTION IN MUTUAL FUNDS

One can check a huge difference in NAVs is generated in long term. Generally, Dividend yield of Mutual fund scheme is always far greater than the market so if you are a longer term investor then always choose Growth option so that you can not miss the compounding effect.

10.60% Edelweiss Finance – ECL finance- NCD Feb 2015:

 

//Please note Edelweiss issue will be preclosed on March 02, 2015.

Edelweiss Group’s – NBFC [Non Banking Finance company] arm ECL Finance has come up with Secured NCD issue which will open on Feb 26, 2015 and will close on March 16, 2015.

Company is looking to raise Rs 800 crore through NCDs.

This issue offers different investing options for tenures of 36 months and 60 months like – Monthly Interest, Annual Interest or Cumulative Option where principle and interest will be payable at maturity

ECL Finance is promoted by Edelweiss Financial Services company Ltd which is listed company at both BSE and NSE.

Important Dates:

  1. Issue Open Date:Feb 26, 2015
  2. Issue Close Date:March 16, 2015.

Security : This issue will be secured and company will create charge over physical asset and specific receivables of company in favor of debenture trustees of the issue.

Credit Rating :AA by CARE which indicates higher safety of this issue.

Investment Options: As already stated this issue offers different investment options for tenure of 36 and 60 months with monthly,Annual interest payment and cumulative.

Tax Deduction at source: TDS will applicable for physical mode and tax will be deducted at source if interest in financial year crosses Rs 5000 and if 15G or 15H form is not submitted.

Monthly Interest Payment Option:

Interest will be payable monthly.Here interest will be variable and depend on number of days.

WWW,SAVING-IDEAS.COM - EDELWEISS ECL FINANCE NCD FEB2015 MONTHLY INTEREST OPTION

Annual Interest Payment Option:

WWW.SAVING-IDEAS.COM - EDELWEISS NCD FEB 2015 ANNUAL INTEREST PAYMENT

Cumulative Option:

WWW.SAVING-IDEAS.COM - EDELWEISS NCD FEB2015 CUMULATIVE OPTION

Profit Report – last 03 years:

EDELWEISS NCD FEB2015 PROFIT REPORT

As inflation is trending down currently so high probability is that interest rates will also trend down in future.Interest rate of 10.60% for AA rated NCD can be a good investing option considering period of next 05 years and investor can allocate some part of fixed income portfolio in this issue.


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