Rural Electrification Corporation (REC) is coming out with the second tranche of tax free bond issuance of this fiscal to raise 300 Cr. with an over subscription option of 400 Cr aggregating upto Rs. 700 Cr.  The issue Open for subscription on  27 Oct 2015 and close  on 4 Nov 2015. 

NRI Can Apply this Issue 

Product Note

Issue Highlight – REC Tax Free Bond Tranche 2 
IssuerREC Ltd
Type of InstrumentSecured, Redeemable, NCD having tax benefit u/s 10 (15) (iv) (h)
Issue Open27 Oct 2015
Issue Close4 Nov 2015 (with option of early closure or extension)
Issue Size700 Cr.
Face ValueRs. 1,000
Min. Application Size5 Bonds (Rs.5000) & multiply of 1 Bond thereafter (across all series bonds)
Interest Annually
Mode of AllotmentD'mat & Physical
RatingAAA by CRISIL ICRA & CARE
ListingProposed on BSE & NSE
Interest on Application MoneyOn Allotment : same as coupon Rate On Refund : 5.00 % P.A.
Referance

Issue Structure –

OptionOption 1Option 2Option 3
Tenor10 Yr15 Yr20 Yr
CouponRate
Category - I, II, IIISeries 1A6.89%Series 2A7.09%Series 3A7.18%
Category - IV (Retail)Series 1B7.14%Series 2B7.34%Series 3B7.43%

Retail Option for Individuals if application is for 10 lacs or less

Cheque Details-

Retail Investor  :  ” REC Tax Free Bonds 2015- Escrow Account – R”

Non Re-patriaction Basis  :  ” REC Tax Free Bonds 2015- Escrow Account – NR Non-Repat”

About Issue

About the Issuer

REC (Rural Electrification Corporation) is a public financial institution in the power sector. The company is engaged in the financing and promotion of transmission, distribution and generation including renewable energy projects throughout India. It believes that its organization occupies a key position in the Govt. of India’s plans for the growth of the Indian Power sector. REC assists clients in formulating and implementing a broad array of power projects and finance those projects. The primary financial product of the company is project based long-term loans.

The company commenced operations in  1969 for the purpose of developing the power infrastructure in rural areas. It has contributed to the development of rural India through funding of transmission and distribution projects in rural areas.

REC has two wholly owned subsidiaries i.e. REC Transmission Projects Company Ltd and REC Power Distribution Company Ltd. It also has a 25% stake in a JV i.e. Energy Efficiency Services Ltd.

  • Financial position is strong and the business is profitable.
  • Uniquely positioned to access and appraise borrowers in the Indian power sector.
  • Occupying a key strategic position in the GoI’s plans for growth of the power sector.
  • Possessing an experienced management team with sector expertise.
  • Pan India presence through zonal/project offices in most of state capitals.

Benefit to Investor

  •  The Income by way of Interest on these Bonds is fully exempt from Income Tax as per provision under section 10(15) (iv) (h) of IT act.
  • No TDS
  • Capital Gain Benefit – capital gain arising on the transfer of listed bonds shall be taxed @ 10% without Indexation or @20% with Indexation.

Subscription Data

Daily  Subscription Figure for REC Tax Free Bond Tranche 2

Cat 1Cat 2Cat 3Cat 4Total
Issue Size (Cr)70175175280700
27 Oct Subscribe (Cr.)135.02511.34417.671032.962096.99
No of Times1.932.922.393.693.00

Allotment/Listing

REC Tax Free Bond Tranche 2 – Allotment Details :

Tax Free Bond 2015-16REC Ltd
Issue Open27 Oct 2015
Issue Close 4 Oct 2015 (early close )
Issue RegistrarKarvy Computershare Pvt Ltd
Listing ExchangeProposed BSE / NSE
Allotment Date
Listing Date
Interest Payment Date each year till the date of maturity
Face Value1000
Circular Ref. NoBSE-
Series 1ASeries 1BSeries 2ASeries 2BSeries 3ASeries 3B
Coupon6.89%7.14%7.09%7.34%7.18%7.43%
For Cat. I, II , IIIFor Cat. IVFor Cat. I, II , IIIFor Cat. IVFor Cat. I, II , IIIFor Cat. IV
Period10 Years10 Years15 Years15 Years20 Years20 Years
ISIN NoINE020 B07JP4INE020 B07JQ2INE020 B07JR0INE020 B07JS8INE020 B07JT6INE020 B07JU4
BSE Script 935538935540935542935544935546935548
NSE Script
Maturity05-Nov-2505-Nov-3005-Nov-3505-Nov-2505-Nov-3005-Nov-35

Registrar of Issue :  Karvy Computershare Pvt Ltd

Depositories :  NSDL & CDSL

Debenture Trustee : SBI Cap Trustee Company Ltd

 

Are you interested to know brokerage structure    mail : rajendra @puneinvest.com

REC Tax Free Bond Application Form & Investment Call : Rajendra 7719917444

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