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IDFC infrastructure bond | IDFC Launches First Long-Term Tax-Free Infra Bonds:

After getting the finance company status from the Reserve Bank of India, the Infrastructure Development Finance Company Ltd., or IDFC, on Monday launched the country’s first long-term tax-free infrastructure bonds having a face value of Rs.5,000 each in one or more tranches to raise Rs.3,400 crore, say reports.

Managing Director and Chief Executive Rajiv Lall said these long-term bonds would hit the market on September 30 (Thursday) and could be subscribed up to October 18. The bonds would come in four series carrying a maximum of 8 per cent coupon.

These bonds, with the highest rating-LAAA—from Icra, could be bought back or redeemed after the five-year lock-in period or could be traded on the bourses, he said. On the conservative way of fixing the yield, Lall said, “Our yield rate is capped at par with the interest rate on government securities and hence cannot offer a yield rate that is above what the 10-year Gilts offer. Also, our objective is to encourage the average retail investors who are salaried as it is a tax-free bond, to invest in these bonds.”

At the BSE, shares of IDFC are now trading at Rs.200.25, down by 2.60% from the previous close.

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