REC India – Rural Electrification Corporation -A Navratna status Govt Of India undertaking PSU have come up with an issue of Secured,redeemable Tax Free bonds.REC can raise Rs. 1000 crore through tax free bond issues in this financial year.
REC was started in 1969 with an objective to finance and promote Rural electrification projects.
Imp Dates:
- Issue Open Date: Oct 27, 2015.
- Issue close Date: Nov 04, 2015 – Please note issue can be closed early if completely subscribed.
- First Interest Payment date:Dec 28, 2015.
- Subsequent annual interest payment date: Dec 01 each year.
Interest Rates:
| Tenure | Interest Rates – Interest payable annually |
| 10 Yrs | 7.14% |
| 15 Yrs | 7.34% |
| 20 Yrs | 7.43% |
- Credit Rating : AAA – By CRISIL, CARE, ICRA and IND Research – indicates highest safety of the issue.
- Good alternative to Fixed Deposits for interest income.Interest earned from Deposits is taxable so effective ,long term yield of Tax Free Bonds will be better.
- One can sell bonds in secondary markets if held in demat form with market yield.But it is suggested not to invest only for listing gains.
- Overall, Good option for long term , tax free income like annuities for long period.
