Thursday, July 25News That Matters

IRFC Tax Free Bonds – Jan 2014 – Details


IRFC is offering tax-free secured redeemable non convertible bonds to raise Rs 1500 crore, with an option to retain oversubscription upto Rs 8663 crore.

The issue will be open during 06-Jan-2014 to 20-Jan-2014 (extended to 7-Feb-2014)

Indian Railway Finance Corporation  (IRFC)
 Tax Free Bonds 
Details Series I Series II
Tenor 10 Years 15 years
Interest Paid Annual Annual
Coupon Rate 8.48% 8.65%
Effective Pre-Tax Yield
(30% tax slab)
12.27% 12.52%
Effective Pre-Tax Yield
(20% tax slab)
10.68% 10.89%
Effective Pre-Tax Yield
(10% tax slab)
9.45% 9.64%
Minimum Application Rs 5000
Maximum Application Rs 10 lacs ( Retail)
Issue Opens on 06-Jan-04
Issue Closes on 07-Feb-14

About the Company

IRFC primarily funds buying of locomotives, coaches and wagons for the Indian Railways. It receives lease rentals from the Railways, which is accounted for in the Railway Budget. This ensures that the loans are securitised against rolling stock, allowing IRFC to raise funds at a lower cost. In fiscal 2011-12, IRFC funded the highest ever rolling stock acquisition comprising 506 locomotives, 2,757 passenger coaches and 13,208 freight wagons, valued at Rs 12,604 crore.

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.
  • NRI Investment: Non US NRI can invest in this issue.
  • 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

Download the Form

You can download the Form from IRFC  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 IRFC Tax free Bonds

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

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