NHAI Tax Free Bonds – January 2014

by Shiv Kukreja on January 12, 2014

in Investments

This post is written by Shiv Kukreja, who is a Certified Financial Planner and runs a financial planning firm, Ojas Capital in Delhi/NCR. He can be reached at skukreja@investitude.co.in

As National Highways Authority of India (NHAI) launches its tax-free bonds issue next week from January 15th i.e. the coming Wednesday, it would become the ninth such company to do that this financial year after REC, HUDCO, IIFCL, PFC, NHPC, NTPC, NHB and IRFC. NHAI would carry coupon rates of 8.75% per annum for the 15-year duration and 8.52% per annum for the 10-year duration.

Though the rates are not as attractive as National Housing Bank (NHB) offered, they are still better than IRFC. Like IRFC, NHAI has also decided not to offer the 20-year option. But, unlike IRFC, the issue is relatively smaller in size and will remain open for four more days i.e. fifteen days, to close on February 5th, Wednesday again.

Size of the Issue - NHAI is authorised to raise Rs. 5,000 crore from tax-free bonds this financial year, out of which it has already raised Rs. 1,301.60 crore through a private placement carried out on November 25, 2013. So, NHAI plans to raise the remaining Rs. 3,698.40 crore from this issue, with Rs. 1,000 crore as the base issue size and Rs. 2,698.40 crore as the green-shoe option.

Rating of the Issue - Being the nodal agency for the development and maintenance of national highways across the country and an autonomous body under the Ministry of Road Transport and Highways, this issue of NHAI has been rated as ‘AAA’ by three credit rating agencies, CRISIL, CARE and Brickwork Ratings, which is again the highest rating by these rating agencies.

Investor Categories & Allocation Ratio - The investors have been classified in the following four categories and each category will have certain percentage of the issue size reserved during the allocation process:

Category I – Qualified Institutional Bidders (QIBs) – 10% of the issue i.e. Rs. 369.84 crore is reserved

Category II – Non-Institutional Investors (NIIs) – 30% of the issue i.e. Rs. 1,109.52 crore is reserved

Category III – High Net Worth Individuals including HUFs – 20% of the issue i.e. Rs. 739.68 crore is reserved

Category IV – Resident Indian Individuals including HUFs – 40% of the issue i.e. Rs. 1,479.36 crore is reserved

NRI Investment - Non-Resident Indians (NRIs) and Qualified Foreign Investors (QFIs) would be disappointed to know that they have been left out as ineligible to invest in this issue.

Allotment on First Come First Served Basis - Subject to the allocation ratio, allotment will be made on a first come first serve (FCFS) basis in each of the investor categories, based on the date of upload of each application into the electronic system of the stock exchanges.

Demat/Physical Option - Investors have the option to apply for these bonds either in physical/certificate form or in demat form, whichever they are comfortable with. But, it is mandatory to have a demat account to sell/trade these bonds. Interest will still get credited to your respective bank accounts through ECS or to that bank account which is linked to your demat account.

Lock-in Period, Premature Redemption & Listing - As these are not tax saving bonds, there is no lock-in period with these bonds. But, at the same time, the investors cannot redeem these bonds back to the company before the maturity period gets over. In order to encash your investment before maturity, you’ll have to compulsorily sell these bonds on the stock exchange(s) where they have been listed for trading.

NHAI has decided to get these bonds listed on both the stock exchanges, National Stock Exchange (NSE) as well as Bombay Stock Exchange (BSE). As always, the company will get these bonds allotted and listed within 12 working days from the closing date of the issue.

Interest on Application Money & Refund - NHAI will pay interest to the successful allottees on their application money at the applicable rate of 8.52% p.a. or 8.75% p.a. as the case may be. It will be calculated from the date of realization of application money up to one day prior to the deemed date of allotment. Investors, who don’t get these bonds allotted, will get interest @ 5% p.a. on their refund money.

Face Value of the bonds & Minimum Investment - NHAI has decided to fix the face value of these bonds at Rs. 1,000 each and minimum application size at 5 bonds. So, the investors will have to invest at least Rs. 5,000 with the company.

Interest Payment Date & Record Date - NHAI has fixed the interest payment date to be March 15. So, the investors investing in this issue will get their first due interest paid on March 15, 2014 and subsequently on March 15 every year, except Sundays and other public holidays.

Record date will be fixed 15 days prior to the interest payment date, except Saturdays, Sundays and other public holidays.

Out of thirteen companies which have been allowed to issue tax-free bonds this financial year, six companies, REC, PFC, NHPC and NTPC, HUDCO and NHB have already exhausted their quota of fund raising through their public issues. While IRFC issue is open and NHAI coupon rates are out, only five other companies, IIFCL, IREDA, Airport Authority of India, Cochin Ship Yard and Ennore Port are left to do such exercise.

While nobody knows in which direction the G-Sec rates are headed, the investors are now left with very few choices to take advantage of these tax-free bonds this financial year. If you still think that inflation, India’s fiscal deficit and G-Sec rates are headed higher, you can probably wait for either IIFCL to launch its Tranche III issue or IREDA to launch its maiden tax-free bonds issue. Otherwise, I think you have only IRFC and NHAI issues to make a choice.

Application Form of NHAI Tax Free Bonds

Note: As per SEBI guidelines, ‘Bidding’ is mandatory before banking the application form, else the application is liable to get rejected. For bidding of your application, any further info or to invest in NHAI Tax Free Bonds, you can contact me at +919811797407

Views: 36904


Get free daily updates in your email:






{ 120 comments… read them below or add one }

Darsh January 12, 2014 at 7:32 am

I have missed all previous tax free bonds.
Should I invest in NHAI or will it be better to buy other bonds eg. HUDCO from market?

I am concerned about liquidity as these are very long term. I know these bonds are listed on exchange and do not have lock in period. But do they have sufficient volumes ?

Pls reply. Thanks.

Reply

Shiv Kukreja January 12, 2014 at 12:37 pm

Hi Darsh,

Liquidity is just enough to cash out your investments in case of any kind of emergency. Its not that there are no takers for these bonds in the secondary markets, but the volumes are not very high. These bonds do not stand anywhere near to the share market in terms of liquidity.

Whether you should buy these bonds in the public issue or from the secondary markets, you need to take a call yourself after analyzing these issues and the listed bonds.

Reply

Binish January 12, 2014 at 1:30 pm

I have observed volumes are quite high on BSE than NSE, also they quote higher price on NSE by as much as ?10/-
Consider e.g. HUDCO TFBs issued 16/02/2013

Data for 10th Jan 2014:
NSE Volume: 16, Price: ?975
http://www.nseindia.com/live_market/dynaContent/live_watch/get_quote/GetQuote.jsp?symbol=HUDCO&series=N5

BSE Volume: 690, Price: ?962
http://www.bseindia.com/NewStockReach/StockReach_Debt.aspx?scripcode=961765

Reply

Binish January 13, 2014 at 9:55 am

this is duplicate, can we delete it?

Reply

Binish January 12, 2014 at 1:31 pm

I have observed volumes are quite high on BSE than NSE, also they quote higher price on NSE by as much as ?10/-
Consider e.g. HUDCO TFBs issued 16/02/2013

Data for 10th Jan 2014:
NSE Volume: 16, Price: ?975
http://www.nseindia.com/live_market/dynaContent/live_watch/get_quote/GetQuote.jsp?symbol=HUDCO&series=N5

BSE Volume: 690, Price: ?962
http://www.bseindia.com/NewStockReach/StockReach_Debt.aspx?scripcode=961765

Reply

Shiv Kukreja January 12, 2014 at 7:00 pm

It varies on a daily basis, sometimes NSE volumes are higher, but most of the times BSE volumes are higher.

Reply

Rajesh January 13, 2014 at 3:54 pm

As a second thought, have you ever analysed the future of these bonds in terms of liquidity and capital loss in case of abolishing IT Laws. This is a hot topic for one of the major party, expected to win in upcoming election?

Who will then by all these bonds in secondary market with such annual yields(not quarterly compounded)? Does this means Investors have to either wait for the maturity period or sell it with huge capital losses?

Reply

Shiv Kukreja January 13, 2014 at 5:45 pm

Hi Rajesh,
It is either not possible or very difficult to analyse such a change in the income tax laws.

Reply

Amlan Basak January 12, 2014 at 8:46 am

NHAI is coming into the market just at the right time when the refund money from NHB will be available to the investors.
Shiv, I see some negative sentiment about IRFC in the last couple of days, but I hope the same is not applicable for NHAI. :)

Reply

George January 12, 2014 at 9:23 am

The main reason for IRFC having reasonable subscription on first day and momentum lost is because, the public was waiting for hearing the coupon rate of NHAI. Those who wants to apply in both would have already applied. Considering that the size is big and many more days to go, IRFC will have traction once NHAI bond gets over subscribed. IRFC will find it difficult to achieve the full subscription considering the size. NHAI will have a better response and we will be able to make it by 2PM on 15th. Check for subscription at 2PM on 15th and take your call.

Reply

debasis January 12, 2014 at 11:12 am

Dear Shiv,

Can you please let us know the interest payment date of all the TFB that were issued during 2013-14.

Thanks

Reply

Shiv Kukreja January 12, 2014 at 12:40 pm

Sure Debasis, I’ll do that sometime early next week and before Friday for sure.

Reply

Sanjiv January 12, 2014 at 3:30 pm

Hi Shiv,
Are you planning to write a post on https://www.edelweiss.in/ncd/ ?

Reply

Shiv Kukreja January 12, 2014 at 7:02 pm

Hi Sanjiv,

I’ll cover it either today or tomorrow.

Reply

Ikjot January 12, 2014 at 7:11 pm

Hi Shiv,

http://articles.economictimes.indiatimes.com/2014-01-08/news/45991277_1_tata-sons-300-crore-bond-sale
This one looks like good opportunity. Any info about issue opening dates?

Reply

Shiv Kukreja January 12, 2014 at 10:53 pm

Hi Ikjot,
Tata Sons raises money through such private placements on a regular basis. These bonds are not offered through public issues.

Reply

Ikjot January 13, 2014 at 12:22 am

Ok, thanks for clarification Shiv.

Reply

Shiv Kukreja January 13, 2014 at 11:32 am

You are welcome Ikjot!

Reply

george January 14, 2014 at 1:35 pm

Good and last opportunity in this financial year for investors looking for a credible Tax free bond issue. It is also possible that GOI will not be planning such issues in next financial years. Those who are worried about BJP coming to power and doing away with Income Tax , my take is that it is a long way for any such decision to come into effect. No Govt can take such decision in a hurry. Even if that happens , the interest rate will be low and still the TF bonds will have a good market. Happy investing in NHAI bonds to one and all readers in this forum. Since NHAI was the first issue of TF bonds and I had a good experience (Sold a few at Rs 1170 per bond). I encourage investors to subscribe for this bond.

Reply

Viks January 14, 2014 at 7:25 pm

Shiv

Yesterday I received full refund on NHB. I’m wondering whether to invest through the purchase of NHB bonds from market or invest in NHAI bonds. What would your advice. Also do you expect it to close in a day.

Thanks

Reply

Shiv Kukreja January 14, 2014 at 7:43 pm

Sorry Viks, it is a decision you need to take, I won’t be able to take this query here on this forum. Just to add that one should go for bonds/NCDs which yield higher.

My personal feeling is that it is not going to close on the first day, but you never know. NHB refund money is going to help this NHAI issue.

Reply

George January 14, 2014 at 9:55 pm

I know, Shiv will not be able to give suggestion to individual query. But if I were to be in your place, I will subscribe for NHAI considering the fact that you will get it on par. If you were to buy NHB in secondary market you will end up paying 0.5-1 % brokerage and 1-2 % premium. Your YTM will be less than 8.75% offered by NHAI for 15 years bond. NHAI currently in secondary market is trading at around 8.5% YTM.

Reply

sundararajan January 14, 2014 at 8:33 pm

Hi Shiv,
I have a question on Hudco tax free bond which I have invested. But I got a letter today from Hudco saying that the allotment letter should be sent to them by tomorrow ie 15th Jan, to get physical bond, otherwise allotment will be cancelled. I received that letter only today, not sure how I can send them by tomorrow. Why do they cancel the allotment if we don’t send the allotment letter. For RECs, they sent physical bond even when I didn’t send the allotment letter. Please let me know if you know any ways , for sure I don’t want my allotment to be cancelled. Thank you.

Regards,
Sundar.

Reply

Shiv Kukreja January 14, 2014 at 8:48 pm

Hi Sundar,

I think you should either call or write a mail to the customer care department of Karvy Computershare regarding this. You can ask Karvy if the scanned copy of the duly filled letter can work in this case. I think they will surely understand this case and extend the deadline.

Reply

sundararajan January 15, 2014 at 12:34 am

Hi Shiv,
Thanks, I will check with Karvy
Regards,
Sundar.

Reply

Ramadas January 14, 2014 at 8:54 pm

I am also disappointed in the way HUDCO is handling bond holders holding bonds in physical format. Bond holder need to send the letter of allotment to HUDCO by registered post to receive bonds. I havent yet received any date to send the allotment letter to registrar. I received NTPC and NHPC bonds without any of these trouble

Regards
Ramadas

Reply

George January 14, 2014 at 9:47 pm

Sundar, I suggest you scan and sent the letter to their email id and inform that if needed physical copy will be sent by courier which requires time. That will be fine.

Reply

George January 14, 2014 at 9:48 pm

Sorry , I meant Ramdas.

Reply

George January 14, 2014 at 9:49 pm

I am also surprised why some of you are not opting for demat accounts which is more safe and easy to handle.

Reply

Ramadas January 14, 2014 at 10:45 pm

George

Not all will have demat accounts especially if someone is applying for bonds in the name of family members. It doesnt make sense to have demat accounts just to hold these TFB if you are sure you will hold to maturity and when the amount invested is not very high.

Regards
Ramadas

Reply

George January 15, 2014 at 8:19 am

Got it Ramdas. Makes sense!

Reply

sundararajan January 16, 2014 at 12:04 am

Hi,
I have opened demat account bit later so that couple of bonds are in paper form. I don’t realise that demat account is required if I have to trade these bonds. Thanks for your feedback.

Regards,
Sundar.

Reply

Ikjot January 15, 2014 at 12:00 am

Once again very well written post Shiv and want to thank you for continuing to guide us. So here we have another issue.. I’ve already invested heavily in TFB’s in 2013-14 at average return rate of 8.91% and considering very few companies are left to come up with TFB’s this year, who knows this might be the last good opportunity so won’t miss this one either. Also as you promised still waiting for your post on interest rate dates of the bonds issued in 2013-14.

Regards

Ikjot

Reply

Shiv Kukreja January 15, 2014 at 8:09 pm

Thanks for your kind words Ikjot !!

I’ll post the article having interest payment dates & other details either tomorrow or day after for sure.

Reply

Ram January 15, 2014 at 11:24 am

Hi Shiv,

Wonder why NRIs are permitted in certain TFBs and not in others. Any idea what would be the rationale behind such decisions?

Also are OCI cardholders (dual citizenship) residing in India permanently and resident for tax purposes eligible to apply?

Thanks
Ram

Reply

Shiv Kukreja January 15, 2014 at 8:25 pm

Hi Ram,

One, it is the managements’ decision whether to offer it to the NRIs or not. Two, certain companies are not allowed to do it for the NRIs.

I am not 100% sure, but I think OCI cardholders resident for tax purposes are eligible to apply for these bonds.

Reply

Ram January 16, 2014 at 8:17 am

Thanks Shiv.

Reply

Shiv Kukreja January 16, 2014 at 11:19 am

You are welcome!

Reply

Akhilesh January 15, 2014 at 7:03 pm

Hi Shiv,
Can u plz post today’s subscription figures?

Thanks.

Reply

Shiv Kukreja January 15, 2014 at 8:26 pm

Hi Akhilesh,

Posted the subscription figures.

Reply

Akhilesh January 15, 2014 at 8:30 pm

Thanks Shiv

Reply

Shiv Kukreja January 15, 2014 at 8:05 pm

Day 1 (January 15) subscription figures:

Category I – Rs. 597 crore as against Rs. 369.84 crore reserved
Category II – Rs. 865.62 crore as against Rs. 1,109.52 crore reserved
Category III – Rs. 693.83 crore as against Rs. 739.68 crore reserved
Category IV – Rs. 617.14 crore as against Rs. 1,479.36 crore reserved
Total Subscription – Rs. 2,773.58 crore as against total issue size of Rs. 3,698.40 crore

Reply

Ikjot January 15, 2014 at 9:20 pm

Very good response on first day, I think this issue will close within few days.

Reply

Shiv Kukreja January 16, 2014 at 12:02 am

I think it should take 5-6 days for the issue to get closed.

Reply

Aditya Gokhale January 15, 2014 at 11:45 pm

Hi Shiv,
What are the chances of getting 100% allotment tomorrow in Cat4 ?

Reply

Shiv Kukreja January 15, 2014 at 11:53 pm

99.99% chances of getting 100% allotment tomorrow. I think it will take 5-6 days to reach Rs. 1,479.36 crore figure.

Reply

Paresh Patel January 16, 2014 at 2:22 am

Hi Shiv
Kindly send me the informations about this NHAI Bonds like daily figures etc.
Thanks

Reply

SB January 16, 2014 at 2:44 pm

Hi Shiv,

If someone has opted for physical form at the time of application, can he switch to demat mode before issue closure. (This may happen if his application for demat account is processed after his bond application). If yes, then what is the mode of communication to registrar ? Will a letter to registrar quoting application number, demat account number etc. suffice?

Thanks in advance for your response.

Reply

Shiv Kukreja January 16, 2014 at 4:52 pm

Hi SB,

I am not sure about it, but I think it is not possible. I think you should write a mail to the Registrar asking if it is possible.

Reply

Shiv Kukreja January 16, 2014 at 6:51 pm

Day 2 (January 16) subscription figures:

Category I – Rs. 597 crore as against Rs. 369.84 crore reserved
Category II – Rs. 1,067.84 crore as against Rs. 1,109.52 crore reserved
Category III – Rs. 858.91 crore as against Rs. 739.68 crore reserved
Category IV – Rs. 829.97 crore as against Rs. 1,479.36 crore reserved
Total Subscription – Rs. 3,353.72 crore as against total issue size of Rs. 3,698.40 crore

Reply

Nagendra January 16, 2014 at 8:10 pm

Hi Shiv,
Where from do you get the subscription figures? I am interested to know if there is anyway to know the term each category investor has subscribed and by how much? for instance something like 25% of retail investor has subscriber to 10 yrs term and 75% subscribed to 15yrs term. I am ok to drive the precentage if I could get the numbers from reliable source.

Thanks

Reply

Shiv Kukreja January 16, 2014 at 10:26 pm
Nagendra January 17, 2014 at 3:11 am

Thanks Shiv

Reply

Shiv Kukreja January 17, 2014 at 9:37 pm

You are welcome Nagendra!

Reply

Shiv Kukreja January 17, 2014 at 10:07 pm

Day 3 (January 17) subscription figures:

Category I – Rs. 597 crore as against Rs. 369.84 crore reserved
Category II – Rs. 1,118.67 crore as against Rs. 1,109.52 crore reserved
Category III – Rs. 862.08 crore as against Rs. 739.68 crore reserved
Category IV – Rs. 968.20 crore as against Rs. 1,479.36 crore reserved
Total Subscription – Rs. 3,545.95 crore as against total issue size of Rs. 3,698.40 crore

Reply

SB January 20, 2014 at 5:17 pm

Hi Shiv,

Could you show today’s ( 20th Jan) subscription figures please?

Regards,
SB

Reply

Shiv Kukreja January 20, 2014 at 7:10 pm

Day 4 (January 20) subscription figures:

Category I – Rs. 597 crore as against Rs. 369.84 crore reserved
Category II – Rs. 1,110.58 crore as against Rs. 1,109.52 crore reserved
Category III – Rs. 864.59 crore as against Rs. 739.68 crore reserved
Category IV – Rs. 1,165.85 crore as against Rs. 1,479.36 crore reserved
Total Subscription – Rs. 3,738.01 crore as against total issue size of Rs. 3,698.40 crore

Total subscription figure crosses total issue size.

Reply

vignesh January 20, 2014 at 9:16 pm

Hi Shiv

I have seen the Subscription figures.

i am a retail investor . is it make sense to apply now ?

As still Category 4 still have bandwidth if i apply tomorrow will i be able to get it ?

In case total subscription Crosses will there a chance for closing the subscription ? or it will be open till the individual category limits ?

It has been very useful shiv Onemint , In this uncertain environment Capital protection becomes a vital thing for my parents .

You have helped me a lot :)

Regards
Vignesh

Reply

Shiv Kukreja January 21, 2014 at 1:01 pm

Hi Vignesh, thanks a lot for your kind words and I am glad that our posts have helped you in taking better financial decisions! :-)

Coming back to your query, if a retail investor applies for these bonds today, he’ll get full allotment. The company will not close this issue until the retail portion gets fully subscribed. I think it should take at least 2-3 days for the retail category to get oversubscribed.

Reply

Praveen January 20, 2014 at 10:21 pm

Hi Shiv,

Apart from yearly interest, will there be any capital/face value appreciation for the investment done in TFBs?

Reply

Shiv Kukreja January 21, 2014 at 1:28 pm

Hi Praveen,

Yes, there is a scope of capital appreciation with these bonds and apart from the tax-free interest, it is this feature only which attracts me the most. It happens whenever there is a fall in the general interest rates or G-Sec yields.

As observed with the recently listed bonds like NHB, HUDCO, NHPC, PFC etc. these bonds have already undergone some good gains in their prices. But, at the same time, there is a risk of capital loss also if interest rate move up from the current levels.

Reply

SB January 21, 2014 at 12:11 pm

Chances of allottment seems to be fair today (Shiv, correct me if I am wrong). Over the last 4 days I have noticed a daily subscription not exceeding 300 crores in the retail category. Today day end we can expect almost near 1480 cr in retail category. Tomorrow it looks like the retail will be oversubscribed with practically no very limited chances of allottment.

Reply

Shiv Kukreja January 21, 2014 at 1:31 pm

I think it should take at least 2-3 days more for the retail category to get oversubscribed and cross Rs. 1,480 crore mark. Chances of full allotment are almost certain today.

Reply

Rama January 21, 2014 at 10:53 pm

Today’s figures for retail (category 4) is Rs. 1267.15 crores against Rs. 1,479.36 crore reserved. So there is still room for applications to be made for retail investors.

Reply

Shiv Kukreja January 22, 2014 at 12:05 am

Day 5 (January 21) subscription figures:

Category I – Rs. 597 crore as against Rs. 369.84 crore reserved
Category II – Rs. 1,110.58 crore as against Rs. 1,109.52 crore reserved
Category III – Rs. 861.89 crore as against Rs. 739.68 crore reserved
Category IV – Rs. 1,267.15 crore as against Rs. 1,479.36 crore reserved
Total Subscription – Rs. 3,836.62 crore as against total issue size of Rs. 3,698.40 crore

Reply

Shiv Kukreja January 23, 2014 at 12:54 am

Day 6 (January 22) subscription figures:

Category I – Rs. 597 crore as against Rs. 369.84 crore reserved
Category II – Rs. 1,110.58 crore as against Rs. 1,109.52 crore reserved
Category III – Rs. 862.72 crore as against Rs. 739.68 crore reserved
Category IV – Rs. 1,394.40 crore as against Rs. 1,479.36 crore reserved
Total Subscription – Rs. 3,964.70 crore as against total issue size of Rs. 3,698.40 crore

Reply

Shiv Kukreja January 23, 2014 at 12:55 am

Retail investor category is expected to get oversubscribed either today or tomorrow maximum. The issue will get closed either on Friday or on Monday.

Reply

Shiv Kukreja January 23, 2014 at 1:25 pm

IREDA has filed the Draft Shelf Prospectus with SEBI for its tax free bond issue on January 21st. The issue will be ‘AAA’ rated and NRIs are not eligible to invest in this as well.

Reply

vignesh January 23, 2014 at 1:46 pm

Shiv

any idea on Coupon rates ?

Reply

Shiv Kukreja January 23, 2014 at 3:21 pm

No idea as yet, it is too early to make a guess.

Reply

vignesh January 23, 2014 at 8:28 pm

Hi shiv

what is the today subscription figures of NHAI tax free bonds ?

Please can you post that

Reply

parvathi gopalan January 23, 2014 at 9:36 pm

Todays subscription of NHai tax free bond?

Reply

Shiv Kukreja January 23, 2014 at 9:53 pm

Day 7 (January 23) subscription figures:

Category I – Rs. 597 crore as against Rs. 369.84 crore reserved
Category II – Rs. 1,110.63 crore as against Rs. 1,109.52 crore reserved
Category III – Rs. 862.87 crore as against Rs. 739.68 crore reserved
Category IV – Rs. 1,486.07 crore as against Rs. 1,479.36 crore reserved
Total Subscription – Rs. 4,056.56 crore as against total issue size of Rs. 3,698.40 crore

Reply

Aditya Gokhale January 23, 2014 at 10:15 pm

Hi Shiv – Will the issue close on Monday ?

Reply

Shiv Kukreja January 24, 2014 at 10:54 am

Hi Aditya,
NHAI should have closed it today itself, but it will get closed on Monday for sure.

Reply

Sagar Diwan January 24, 2014 at 12:02 am

I think this means roughly 92% allotment for the retail applications made today.

Reply

Shiv Kukreja January 24, 2014 at 10:56 am

Yes, approximately 93%.

Reply

Shiv Kukreja January 24, 2014 at 6:42 pm

Day 8 (January 24) subscription figures:

Category I – Rs. 597 crore as against Rs. 369.84 crore reserved
Category II – Rs. 1,110.85 crore as against Rs. 1,109.52 crore reserved
Category III – Rs. 863.95 crore as against Rs. 739.68 crore reserved
Category IV – Rs. 1,501.64 crore as against Rs. 1,479.36 crore reserved
Total Subscription – Rs. 4,073.43 crore as against total issue size of Rs. 3,698.40 crore

Reply

Shiv Kukreja January 24, 2014 at 6:44 pm

NHAI has decided to preclose this issue on Monday, January 27th.

Reply

Raju January 25, 2014 at 4:19 pm

Good. We will get the allotment faster :).

Reply

Shiv Kukreja January 25, 2014 at 11:45 pm
Karthik January 27, 2014 at 4:25 pm

Hi Shiv,

Great info and analysis

If I subscribed to this issue today (27th Jan 2014), what percentage of allotment can I expect ? I am a retail investor

Thanks in advance.
Karthik

Reply

Ashok January 27, 2014 at 5:32 pm

0% unless there is a heavy withdrawal of earlier bids.

Reply

Shiv Kukreja January 27, 2014 at 6:37 pm

Thanks Karthik for your kind words!
Also, I think you won’t get any allotment had you subscribed for these bonds today. The issue got oversubscribed in the retail category on Thursday itself. Also, the issue got closed today.

Reply

Karthik February 6, 2014 at 11:07 am

Shiv / Ashok,

I did subscribe to these on the last day. And guess what…I got full allotment….either there were some withdrawal of bids or I just got lucky :-)

Reply

Shiv Kukreja February 6, 2014 at 12:34 pm

Oh that’s great, lucky you !! :-)

Reply

Shiv Kukreja January 27, 2014 at 9:25 pm

Day 9 (January 27) subscription figures:

Category I – Rs. 597 crore as against Rs. 369.84 crore reserved
Category II – Rs. 1,110.85 crore as against Rs. 1,109.52 crore reserved
Category III – Rs. 865.56 crore as against Rs. 739.68 crore reserved
Category IV – Rs. 1,522.89 crore as against Rs. 1,479.36 crore reserved
Total Subscription – Rs. 4,096.29 crore as against total issue size of Rs. 3,698.40 crore

The issue stands closed today.

Reply

pradeep January 29, 2014 at 7:33 pm

When will the allotment be done ? when is the next issue and by whom :)

Reply

Shiv Kukreja January 31, 2014 at 10:25 am

No info as yet.

Reply

sowmiya January 31, 2014 at 3:51 pm

hi,

i would like to invest in nhai bonds. Is it still available? If so, please let me know the procedure, as am new to this.

Thanks

Reply

Shiv Kukreja January 31, 2014 at 7:50 pm

Hi Sowmiya,

NHAI issue has closed. IRFC issue is still open.
http://www.onemint.com/2013/12/28/irfc-tax-free-bonds-8-65-january-2014-issue/

Reply

Akhikesh February 1, 2014 at 10:24 am

Hi Shiv,
Any idea by when v can expect ireda bonds opening & its interest rate.

Reply

Shiv Kukreja February 1, 2014 at 5:42 pm

Hi Akhikesh,
There is no info I have to share about IREDA issue. Market sources are anticipating it to open sometime in the 2nd week of February.

Reply

Akhikesh February 1, 2014 at 6:48 pm

Thanx Shiv for ur prompt reply.
Plz post d details in d comments section as & wen u get any info.

Reply

Shiv Kukreja February 1, 2014 at 6:55 pm

Sure, I’ll do that.

Reply

vignesh February 3, 2014 at 11:37 pm

Hi shiv

when will actual allocation of NHAI will start ?

Regards
Vignesh

Reply

Shiv Kukreja February 4, 2014 at 12:21 pm

Hi Vignesh,
I think NHAI allotment should start happening from Thursday this week.

Reply

Sanjay February 5, 2014 at 6:47 pm

Just got the SMS of NHAI allotment.

Reply

Shiv Kukreja February 6, 2014 at 11:58 am

That’s great, thanks for sharing this info!

Reply

kshitij February 5, 2014 at 3:14 pm

Hi Shiv
I had sold my house in may, 2013 resulting in Long Term Capital Gains. Now I want to claim deduction u/s 54 EC by investing in NHAI/REC bonds. But the time limit of 6 months has expired. Is there any way out now for claiming exemption u/s 54 EC.

Thanks

Reply

Shiv Kukreja February 6, 2014 at 12:00 pm

Hi Kshitij,
There is no way out. You can avoid capital gain tax by investing in some other property now.

Reply

Rama February 6, 2014 at 10:44 pm

Hi Shiv, the NHAI bonds have been remitted to my DMat account today. I have got a 100% allotment. Thanks.

Reply

Shiv Kukreja February 7, 2014 at 8:14 pm

That’s great Rama! Have a happy listing! :-)

Reply

Shiv Kukreja February 7, 2014 at 8:05 pm

NHAI tax-free bonds to get listed on the BSE & NSE on February 10th i.e. Monday.

Here are the BSE & NSE codes for the same:

8.52% 10-year bonds – BSE Code – 961824, NSE Code – N4
8.75% 15-year bonds – BSE Code – 961826, NSE Code – N6

Deemed date of allotment has been fixed as February 5, 2014. Interest will be paid on March 15th every year.

Reply

Raj February 7, 2014 at 9:01 pm

Shiv, I think the coupon payment date was fixed as Mar 15. Can you confirm.

Reply

Shiv Kukreja February 8, 2014 at 1:46 am

Hi Raj,
Yes, you are right, it is actually March 15th every year. I have corrected my statement above.

Reply

TCB February 27, 2014 at 10:01 pm

Dear Shiv,
NHAI N6 bond price has fallen by more than a percent on 26/2/14. On NSE website, it is written that record date for interest payment is on 28/2/14. If so, what could be the reason for fall on 26/2/14 ?
Thanks
TCB

Reply

Shiv Kukreja March 3, 2014 at 7:46 pm

Dear TCB,
These bonds went “Ex-Interest” on February 26th.

Reply

amit agrawal February 17, 2014 at 2:13 pm

sir , please conform whether NHAI tax free bond closed or not ?

Reply

Shiv Kukreja February 18, 2014 at 1:23 pm

Hi Amit,
NHAI tax free bond issue got closed on January 27.

Reply

Shiv Kukreja March 5, 2014 at 5:43 pm

‘AAA’ rated NHB tax free bonds issue is getting opened on March 7th with the following coupon rates – 8.50% p.a. for 10 years, 8.93% p.a. for 15 years and 8.90% p.a. for 20 years. Issue size is Rs. 1,000 crore and will get closed on March 18th. NRIs cannot apply in this issue.

Reply

dr puneet April 10, 2014 at 6:52 pm

dear shiv
i got 1000 bonds in allotment in my personal demat account. my father purchased 20 bonds from nse in demat account which is held as joint account with me ,of which he is the first holder.will it affect rate of interest on bonds held with me.thanking u in advance.

Reply

Shiv Kukreja April 11, 2014 at 11:54 am

Hi Dr. Puneet,
As your father is the first holder in the 2nd investment, it won’t affect the interest rate on your 1st investment.

Reply

dr puneet April 11, 2014 at 12:59 pm

thanks a lot dear shiv, i was eagerly waiting for ur reply.

Reply

Shiv Kukreja April 11, 2014 at 1:17 pm

Great !! :-)

Reply

R Rajakumar April 16, 2014 at 7:11 am

Dear Sir,

I have purchased 10 units of NHAI-Tax Free Bonds-Tranche-Series II B, through stock exchange on 26-feb-2014.
I have not received the interest on 15/3/2014. Can you clarify the reason for the same.

with regards,
R.Rajakumar

Reply

Shiv Kukreja April 16, 2014 at 8:53 pm

Hi Rajakumar,
These bonds got “Ex-Interest” on February 26th. Had you bought them a day earlier, then you would have got the due interest paid.

Reply

joshi anandateertha August 3, 2014 at 8:39 pm

I WANT TO INVEST MY SURPLUS FUNDS TO THE TUNE OF 18.00 LAKHS APPR IN TAX FREE BONDS. WHETHER I SHALL WAIT FOR SOME GOOD PSUS LIKE NHAI OR NHB OR HUDCO TO COME WITH NEW TRANCHE OF BONDS OR SHALL I GO FOR PURCHASES IN THE SECONDARY MARKET ?

JOSHI A R

Reply

Shiv Kukreja August 12, 2014 at 6:59 pm

Hi,
You won’t have any new issue of tax-free bonds this financial year, so you should go ahead and buy these bonds from the secondary markets.

Reply

Dinesh Gakhar October 26, 2014 at 1:24 pm

Dear Sir I want to know that the interest on tax free bond is taxable or taxfree. ( in long term capital bond )

Reply

Leave a Comment

Previous post:

Next post: