Power Finance Corporation (PFC) 80CCF Infrastructure Bonds
Power Finance Corporation (PFC) is the second company after IFCI to come out with their 80CCF infrastructure bonds.
These bonds help you get tax benefit over and above the Rs. 1,00,000 that you get by investing in Section 80C tax instruments.
The face value of each bond is Rs. 5,000 and PFC will come out with an issue size of Rs. 200 crores or Rs. 2 billion.
These bonds are secured, and rated AAA/Stable from CRISIL and AAA with stable outlook by ICRA.
The bonds will be available in both Demat and physical form, and these are the other terms of the PFC infrastructure bonds.
Terms of the PFC 80CCF Infrastructure Bonds
It’s a good thing that PFC infrastructure bonds have opened up so much ahead of time because it gives people enough time to subscribe to them and get the tax proofs well ahead of March 31st.
PFC is a good company, and the interest rates among these 80CCF bonds aren’t going to vary much as they are capped at the 10 year government bond yields, so I think people who are looking to invest in these bonds can give PFC a serious thought.
Last year, there were some news reports that LIC was going to offer these bonds with along with free life insurance and circumvent the cap on yields, but that never materialized.
I don’t know if any other company will try to pull something similar this year or not, but with just an investment of Rs. 20,000 in these – it will not make a lot of difference in absolute terms.
Can somebaody explain me what does buyback means in terms of bonds? Also, will I get same interest in buyback. Buyback can be done any time after the lock-in period?
It means that after 5 / 7 years – PFC may decide to redeem your bonds – you will get the interest and everything, and this will be exactly like redemption.
Thanks Manshu for your reply. “PFC may decide to redeem your bonds :”: May decide is like there are not 100% sure. Also, After 5/7 yrs, can I redeem on any day or is there some timeline?
Thank you for asking that question – I should have elaborated that point more.
Yes, you do have an option to buyback as well, and after the lock in period there will be a notification period where you need to tell them whether to exercise the buyback or not. If you want them to exercise the buyback then they will redeem your bonds at that date, so in that sense the maturity becomes shorter than the 10 or 15 years.
Based on what I read the form should also have space for you to indicate whether you want to use the buyback facility or not, and if you indicate there that you do want the buyback to be affected then you don’t need to do anything later on, and your bonds will be redeemed during the buyback period.
So these guys are calling it a buyback facility which it really is since you as an investor have an option to choose whether you want to redeem your bonds earlier or keep it for the longer duration.
I hope this explanation is clearer – the early one was quick and didn’t cover as much details as it should have so thanks for asking the follow up question.
Thanks for nice and clear reply.
great – i’m glad it made sense.
is there a possibility to redeem d bonds before maturity if yes den how??
Hi Mayank… you cannot redeem these bonds before the lock-in period ends.
Hi Manshu,
Thanks for you post. It is helpful.
For benefit over and above 80C tax instrument (limit abov 1,00,000), which of the following is better for those in 20% and 30% tax bracket?
Option 1: Infrastructure bonds OR,
Option 2: Voluntary Provident Fund (over and above the 1,00,000 limit of 80C) which gives 9.5% interest rate.
One major difference (there are many) while calculating the returns is, that the first option has tax benefit but is taxed on interest earned while the option 2 does not have any tax benefit (since it is outside the 1,00,000 limit) but the returns are tax free.
Which is the best way to calculate the returns (post tax) between the above 2 options?
Regards,
Sandriano
I will say upto 20K Infra bonds are better because you save a lot more tax as a result of reducing your taxable salary by 20K and saving about 20% or 30% on that so 4 – 6K.
Int difference of 1% on 20K is just 200 bucks, and tax on that at 20 or 30% is even less so infra bonds are better to the extent of 20K for sure.
After that it depends on a whole host of other factors as you say.
Thanks Manshu for your analysis and suggestion. Believe I will go for this investment.
Great – get all the proofs and everything in time, and file for it – I’ve seen a lot of people scampering for the tax proofs last time, and that’s always an irritating thing.
Haven’t seen any online broker offering it yet. IFCI is already there in their list. hope they put in PFC as well just to avoid any physical applications in case one wants to apply online.
Hdfc securities has this one online.
One can buy IFCI Infra Bonds online on fundsindia.com
Hi Manshu,
Thank you for the information. If I buy these through ICICIDirect, Do they charge us extra ? For the matter of fact, what is the advantage that we recieve if we buy them online than physical ? Please enlighten.
Cheers, Karthik
Hi Karthik,
I’m not sure what or if ICICI Direct charges any commission at all. The benefit of investing online is that it is in a Demat form along with your other securities so you don’t have to worry about paperwork, your interest will be credited to your account, and so will the redemption amount etc.
The drawback of doing it online is that the bonds will get locked in your Demat account, and if you want to close your Demat account before the maturity of these bonds then that is a huge hassle and I don’t even know if anyone has done that successfully or not.
Hello,
If i opt for paper form then where do i need to go to redeem this?
and
If i opt for demat form then what is the process to redeem this? Is it just like selling Shares online ?
Regards,
Redemption will happen automatically – you don’t have to do anything extra for that. If you want to sell when it lists on an exchange then that will be done in the case of the Demat ones only. That will also be possible only after the lock in period is over so after about 5 years or so.
can anybody help me in finding agents / selling points of this bond in KOLKATA ??
Manshu– re your point regarding demat and bonds– this year I switched from a joint a/c to a single name a/c and with bonds there was a delay because the dp has to write to the co. for the transfer, but it got done.
Re PFC just downloaded the form from ICICIsecurities, paper submission as I have a ICICIdirect a/c but no internet banking *sheepish*.
No internet banking!?
Someone please remind me what year I am in! 🙂
will you please confirm who are the lead brokers in PFC Infrastructure Bonds – U/s 80CCF.
SBI Capital Markets, Karvy, PNB Investment Services and ICICI Securities.
Hi Manshu,
Are there any paper-based Infra bonds available in Market (or coming soon).
Is there anyway one can buy the same without having Demat account?
Cheers!
Yeah, these bonds are both paper and demat, so you can buy even the PFC issue without a demat account.
Hi I am deb I want to know how I able to invest in this bond & what is mean by buyback.
Deb buyback means you can redeem the bonds for less time period than the maturity, and in a way this is just like maturity.
You can buy it from one of the centers close to your home or online if your broker has this option. You can also approach a financial adviser for this.
Hi Manshu,
Pl confirm whether the redeemed amount is taxable or not?? If taxable let me know the rate and under which section the proceeds are taxable??
Hi ,
Please let me know where do I can buy the PFC Infra Bond in paper form in Mumbai
Does any bank selling physical copy of the bond? E.g., HDFC Bank
Thanks,
Suman
Hi.. I think people who want to invest in Infrastructure Bonds should wait for a week to 10-15 days. IDFC, L&T, REC, PFS etc. are planning to come with their Infra Bonds offering in November and I’m quite confident that the Rate of Interest these cos. are going to offer would be 9%, as the 10-year Govt. bond yield has risen sharply close to 9% in October.
i want to by infra bonds for tax saving purpose plz tell me which bond is available
Hi Gurinder.. IFCI Infra Bonds are available as of now but the issue closes today, so if you are in a hurry, speed up your acts to apply.
Hello,
Can you please tell me simplest way to gain Paper-baesd (without DEMAT account) Infra bonds?
Contact a bank or broker like Karvy near your house and see if they have it.
I had gotten the form off the net from PFC’s site and submitted it via post to a collection center.
Stamped receipt received.
Filled in demat account details, so that’s that.
Excellent! Way simpler than what I said – thanks for sharIng.
Where can i check the allotment status !!! .. When it will be available ..
Sir,
I apply for PFC Infrastructure Bond. My application No. 14876858 and deduct amount by my account. But I have no any Information, No Bond in demat account, No any certificate, No any E-mail at my E-mail I.D. about above Bond.
Please inform me necessery information as soon as possible.
Thanking You,
Sandeep Kumar
S/O Sri Bankey Lal
295, Prabhudayal, Near Lal Kuan,
Jahangirabad (Bulandshahr) U.P. – 202394
Mob. 09456029018
E-mail – [email protected]
Look you must understand that this is like a news website like Times of India. You need to contact whoever sold you the bond to get this information. Leaving comments here will not help.
Dear Manshu,
Thank you so much for providing such valuable info on you website.
I have few questions….would be great if you help-
1. If I take any bond like PFC (which sharekhan was not offering on their website though they are offering IFCI infra bond online) by filling up the physical form and provide demat a/c no in tyhe form …then will it get credited to my demat a/c automatically on allotment of the bonds??
2. When PFC infra bonds are getting alloted??
3. IDFC is giving 9% rate of interest….should I wait till Mar-12 to get other infra bonds having higher rate of interest??? If so …then when it is expected ???
Regards
Subi
Dear Subi,
1. Yes, it will be credited to your Demat account.
2. Austere just left a note about that so I think you might have seen that about getting the allotment done today.
3. I don’t think the issues to come will have a much higher rate of interest maybe 0.25% – 0.50% higher and on 20k – that’s not much. I’ve seen that several people wait till very end and then find it difficult to get tax proofs and struggle with it. Ultimately it’s your decision if you want to wait or not but be cognizant of this factor.
Thanks.
Thanks a lot Manshu….. And yes I got the SMS from NSDL just after posting my query….
Regards
Subi
That’s great! I appreciate your follow up comment.
Just in– NSDL sms about PFC allotment in my demat account.
Checking the PFC site, I found list of bondholders of previous issues– fyi.
That’s great to know – thanks a lot Austere!
Me too received sms from NSDL today regarding bond allotment.. I had applied for three bonds and got the same..
Got PFC physical bond certificate last week…:)
That’s excellent – thanks for leaving a comment and letting everyone know here.
Whether PFC has paid interest for the investments into bonds for FY 2010-11? I have not received any payment. And I could not get any details online & whom to contact to know the date of interest payment.
Please guide.
Even I am struggling to find out more about the interest payment. There is no information available online that I could find. I haven’t even received the allotment letter/advice either.
As per my understanding, the interest would be paid annually on the anniversary of the deemed date of allotment, which I think is 23rd November 2011 (the date on which the bonds were credited to my demat account) for this particular tranche.
So I am expecting the interest to be credited to my bank account by the end of this month. If anyone has more info, please add.
Thanks and regards,
Bhavin.
Hi Bhavin… Please check this link –
https://www.onemint.com/2012/10/23/interest-payment-dates-of-infrastructure-bonds-issued-in-2011-12/
Thanks Shiv. I had read that post last month, but I was a bit unsure which PFC was mine since PFC was mentioned twice. (I assumed PFS was a typo and you meant PFC.) (And I should have mentioned this link in my above comment!)
What confounds me is why does the PFC website not have any information?!! I had also bought into PFC’s 2010 bonds and they sent me a very helpful allotment letter/advice then, so there is no confusion there… but no such letter for the Nov 2011 tranche. I didn’t bother contacting them for the letter since my demat account showed all the bonds duly present, so I thought let’s wait and watch. 🙂
Cheers,
Bhavin.
You can get the allotment advice for your PFC Infra Bonds from this link –
http://karisma.karvy.com/investor/jsp/IDFC-APP.jsp
Last year’s PFC Infra Bonds are “Power Finance Corporation Ltd-Infra Bonds Tranche 1-2011”.
Thanks Shiv, this is really helpful. 🙂
Cheers,
Bhavin
Great… Cheers !! 🙂
i had subscribed to your Infrastructure Bonds Series 1 on 15.03.2005. i would like to know the status of the same and when can i encash it. what is the procedure to encash it. at present i am re3asiding in baroda.
please guide.
neelam
When will PFC pay interest for the investments into bonds for FY 2010-11 ?
31March was the exact date of payments.
Regards,
S Singh
sir can you inform me from where i can get live price of pfc bonds and and advice me if it is right time to buy
Hi jiger… you want the price of which PFC bonds – PFC Tax-Free Bonds or 80CCF Tax Saving Bonds ??
yes
PFC 80CCF tax saving bonds cant trade as there is a lock-in period of 5 years. PFC Tax-Free Bonds’ live price can be accessed from this link:
http://www.bseindia.com/bseplus/StockReach/StockQuote/Equity/830PFC2027/830PFC2027/961730/COMPANY
Dear Sir,
I had applied for Infra bond in March 2011 for Rs.20000/- vide application no.2679823 but till date i have not get my Bond copy. Pl advice.
I think you should contact them on the address mentioned on this page:
http://www.pfcindia.com/Content/Bondholders.aspx
i lost my bonds certificate 2011-2012 issue. i donot have any record only application no 44912205
kindly let me to whom i will contact for getting duplicate certificate
tkpaul
durgapur
Please tell me the procedure for redemption of 80ccf IIFC bonds…
Sir,
With ref to your redembtion of pfc infrastructure bond 1 series certificate no 134656, I wish to inform you that due to Postal non delivery of original certificate and the redembtion form sent on 25.07.2015 karvy consultant couldn’t receive the same. Once again I sent the indemnity bond alongwith redemption forms duly filled alongwith cancelled cheque leave and form no.15H. I got the duplicate Bond certificate on 14.01.2016. Now I want only redembtion of the Bond. How I can sent the same same for March,2016 redembtion . Kindly clarify and give proper instructions to M/s.Karvy Consultants under intimation to me.
Muthusubramanian
8056272972
I bought power finance corporation ltd bond for rs.5000×4 units ie for rs.20000 during the year 31 st march 2011. Now the period ends on 31032016, 5 years. Where i have to send the bond or not to send the bond so that i can get back my principle amount. Kindly guide me
Dear sir,
I am holding power finance corporation ltd bond for Rs5000 x 4
from certificate no.116157 and distinctive no. from 63828 to 63831 from 31 March 2011.
Now the bond matured on 31032016. For getting back my principle amount where I have to send the bond or I need not sent ,these details I want to know
Kindly guide me through the e mail thank you sir
Dear sir,
I am holding power finance corporation ltd bond for Rs5000 x 4. Bonds are held in demant account of icici bank dp id in 302679-33713148
from 31 March 2011.
Now the bond matured on 31032016. For getting back my principle amount with interest where I have to claim for payment ,these details I want to know
Kindly guide me through the e mail thank you sir
Dear sir, 07.04.2016
I am holding PFC bond of principal amt. of Rs.20000 having Folio & Warrant No. PFA0245915 & 951632 respectively.The redempted cheque has been accounted to my closed bank account.What can I do to revalidate the cheque to my desired bank account?
Kindly reply through E-mail.
Banshidhar Biswas
I have purchased PFC bonds on 31.03.2011. When I have to apply for buyback ???
Dear Munendra,
Buyback window is closed now for PFC bond.
It will open again in July 2016 time.
Please check with Karvy or PFC.
Regards,
Servesh
PFC Contacts for Grievances on Infrastructure/ Tax-free Bonds
E-mail : [email protected]
[email protected]
Phone : PABX : 011-23456000 Extn : 200/275
Direct : 011-23456200/275
Redemption amt.of Pfc bonds not received so far.
Regd.folio no. PFA0208029
Diet.nos. 31735 to 31738
PAWAN KUMAR ARORA
Mob.no.09968300108
Dear Sir I have dispatched through registered AD 0n 5/3/2016 original certificate and other documents for buy back but till date no payment is received. details are as under series 2 27984 ISIN INE134E07083 Regd Folio No. PFA0208261 Certificate no. 208261 Distinctive Nos 0000032654~00000032657 Kindly intimate the latest status regarding remittance of amount in the notified Bank
Bonds in Demat forms have been bought back and investors got their money back.
Maybe paper bond will take some time.
Why are we going for buyback option? These bonds are paying good interest.
May be bond holder needs money for child education or for some medical emergencies.
I hold 4 Bonds of Rs.5000/ value each. The same are due for encashment on 31-03-2016. Inspite of letters to Delhi and Hyderabad offices, no response so far.
Please check your application form to make sure that you had opted buyback option and Apply for redemption (Buy Back) again. BuyBack will will open in July 2016
Please check with Karvy.
What moderation you want?
To whom I have to apply?
Please refer your letter no 36496 dated 26 Jun 2015 regarding offer for Buyback of PFC Long Term Infrastructure bond.
My registered folio is PFA0214195 and I had purchased 04 in no. S02 series bonds in 2011 bearing distinctive no 56081-56084, which I had opted for buyback option in your above stated letter.
On 05 Aug 2015, I had sent the buyback consent form along with cancelled cheque (ICICI Bank, Mohali chq No: 235351) and PAN copy to the Karvey, Hyderabad address as directed in the said letter. but I had not received the amount in my account as on date.
Please confirm the status of my buyback option request.
Thanking you in anticipation.
SS CHEEMA
09815500724
I have purchased Rs. 20000/- bonds of Power Finance Corporation Ltd. on 22.03.2011. I want to go to buyback pl advise me the procedure and any performa to be completed.
R.K.Goyal
Dear Ravinder,
Please check your application form to make sure that you had opted buyback option during purchasing the bonds. Apply for redemption (Buy Back) again. BuyBack will will open in July 2016. If you had not opted for buyback then it will be redeemed after maturity only ( which is 10-15 Years I guess)
Please check with Karvy.
I want to know whether interest received on these PFC Bonds eligible u/s 80 CCF is taxable .
Yes Ankita, interest received on infra bonds is taxable.
Sir, I had PFC infrastructure bonds in physical bond form. Now let me know how to convert these bonds into demat account. I had demat account with steel city securities. Thank you
Hi Vamsee,
You need to contact your broker Steel City Securities for getting your bonds dematerialised.
Sir, my PFC bonds maturity on 1st April, 2016. But I hadn’t redeemed the bonds. Now how to redeem the bonds and am I get additional interest on gap period on the bonds( gap period is 01/04/2016 to 03/04/2017, today’s date). My PFC bonds are in physical mode. Please clarify me.
Thank you
Vamsee krishna
Can I purchase bond today
I hold 4 tax savings bonds of the face value of Rs. 5000 each in demat for.
Details: DP ID 300749
Client ID : 10300542
I would like to know:
1. Whether these bonds are locked or can be sold / redeemed and how.
2. If not, is there any provision for buy back by PFC ?
3. When will they be finally redeemed ?
Regards,
I have taken power finance corporation ltd infrastructure bond in 2011 my NO as per BGSE is IN302148-10414333 total amount Rs 20000/-
I am not receiving any interest can you please tell me how much I will get at the time of maturity
Sir
My PFC bonds maturity was in the last year.I have purchased bonds worth Rs20000 on 31-03-2011. Application no 19602907 and DP ID/CL ID/Folio no IN 303028-52828973.
How to claim the amount with interest.
Please let me know the procedure to claim the amount