The National Bank for Agriculture and Rural Development (Nabard) will raise Rs.3,500 crore by issuing tax free bonds and Rs.2,100 crore or 60 per cent has been allocated for retail investors. The tenure of these bonds will be between 10 years and 15 years.
For retail investors, the coupon rate for the 10 year bond is likely to be around 7.29 per cent and for the 15 years bond, it is likely to be around 7.64 per cent. For non-retail investors, the coupon rate is expected to be 7.04 per cent and 7.35 per cent for 10 years and 15 years respectively, market participants said.
Nabard was permitted by the Central Board of Direct Taxes to raise tax free bonds of around Rs 5,000 crore this financial year. Nabard has already mobilised 30 per cent of the amount from institutional investors through private placement. The remaining Rs.3,500 crore will be mobilised throughpublic issue which will open on March 9. The bonds will be listed on the BSE.
About 40 per cent of Rs.3, 500 crore has been earmarked for qualified institutional buyers, corporate sector and high net worth individuals, while 60 per cent for retail investors who can invest up to Rs.10 lakh
Nabard has mobilised 30% of the amount from institutional investors
Source : The Hindu
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