HUDCO Tax Free Bonds Tranche 1 – Sep 2013 – Details

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Housing and Urban Development Corporation (Hudco) is targeting to raise up to Rs 4810 crore through the second tranche of its public issue of tax-free bonds.The Finance Ministry has allowed Hudco to raise Rs. 5,000 crore through bonds during 2013-2014, of which Rs. 191 crore has been raised last month through private placement to institutional investors.

The tax free bonds issue would open from 17-Sep-2013 and close on 14-Oct-2013

The issue size is Rs 750 crore with an option to retain oversubscription up to Rs 4810 crore

CARE has given credit rating of ‘CARE AA+’ while IRRPL has given ‘IND AA+
HUDCO Tax Free Bonds 
Details Series I Series II Series III
Tenor 10 Years 15 years 20 years
Interest Paid Annual Annual Annual
Coupon Rate 8.39% 8.76% 8.74%
Effective Yield (30% tax slab) 12.14% 12.68% 12.65%
Effective Yield (20% tax slab) 10.57% 11.03% 11.01%
Effective Yield (10% tax slab) 9.35% 9.77% 9.74%
Minimum Application Rs 5000
Maximum Application Rs 10 lacs ( Retail)
Issue Opens on 17-Sep-13
Issue Closes on 14-Oct-13
About the Company

HUDCO is a public sector company, under the Ministry of Housing & Urban Poverty Alleviation (MoHUPA). It has been a key partner with the government in building assets for the nation.

During 2012-2013,

  • Total Revenue –  Rs 2923 crore
  • Net profit was Rs 700 crore
  • Sanctioned projects worth Rs. 23,000 crore and
  • Disbursed Rs. 6,000 crore

The funds would be utilised to finance the government’s housing and urban infrastructure projects

Other Important Points

  • Investors can choose to apply in demat as well as physical form. Demat account is not mandatory. However, if you want to sell/trade these bonds before maturity, it is mandatory to have a demat account. You can subscribe to them in physical form as well and keep them till maturity.
  • Interest will get credited to your linked bank account through ECS.  The interest payment date is not yet fixed but the first due interest will be paid after 1 year from the deemed date of allotment.
  • The allotment will be made on a “first-come-first-served” basis. Allotment will be done within 12 working days from the closing date of the issue.
  • Bonds will be listed on NSE & BSE
  • NRI Investment: Non-US NRIs can also invest in this issue. They can apply for these bonds both on repatriation basis as well as non-repatriation basis.

 Download the Form

You can download the Form from HUDCO Website.

Taxation Aspects of Tax FREE Bonds

Read my Post –  Taxation Aspects of Tax free Bonds?

Merits & Demerits of Tax free Bonds

Read –  Tax free Bonds – Should you invest in these?

Allotment Status of HUDCO Tax free Bonds

Youc an check the Allotment status of your HUDCO Tax free Bonds application at link below by entering application number / PAN number:

https://mis.karvycomputershare.com/ipo/

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