IREDA Tax Free Bonds Issue - 17th Feb 2014 to 10th March 2014

Post rate hike by RBI on 28th Jan, 2014, IREDA (which stands for Indian Renewable Energy Development Agency Limited) is the first company to come out with the tax free bond issue at an attractive interest rates.  In this post, we shall highlight key features of the bond issue:

Key Features of Bond Issue:

Issue Size	Total Rs. 1,000 crore including green shoe option
Issue open & close date	17th Feb 2014 and 10th Mar 2014.  Allotment on first come first serve basis.
Minimum investment	5 bonds of Rs. 1,000 FV (i.e. Rs. 5,000)
Secured	Yes. MNRE (which is Ministry of New and Renewable Energy) has given letter of comfort on behalf of IREDA for its payment obligations w.r.t. tax free bonds
Listed on	NSE and BSE
Mode of Allotment	Demat as well as Physical.  However, trading can take place in demat form only.
Credit Rating	Care AAA by Care (indicating lowest credit risk and highest safety)
Interest Payment	Annual

Issue structure and interest rates for retail investors:

Tranche – I SERIES	Coupon Rate (%) p.a.	Tenor (in years)
Series IB	8.41%	10
Series IIB	8.80%	15
Series IIIB	8.80%	20

For other details about the issue as well as risk factors, kindly go through the Prospectus before investing.  And do not forget to read who should invest in tax free bonds before investing in IREDA tax free bond issue.