A major portion of the bonds has been allocated for retail investors.
The public issue of tax-free, secured, redeemable and non-convertible bonds in the nature of debentures will open on March 9 and close on March 14 with an option for early closure or extension. The face value of each bond is Rs.1,000 and the bonds will be listed on BSE.
According to an official release issued by Ramesh Tenkil, Chief General Manager, NABARD, Kerala, 60 per cent of the issue size will be reserved for Category IV investors (resident Indian individuals) and HUFs through the ‘karta’, applying for an amount aggregating up to and including Rs.10 lakh across all series of bonds in the issue. Fifteen per cent will be reserved for Category I investors (qualified institutional buyers) and Category II investors (corporates). Ten per cent will remain reserved for Category III investors (high net worth individuals). The interest on the bonds will be exempt from the levy of income tax in the hands of the bondholders. Allotment would be done on first come, first served basis.
The bonds are being offered with options in tenure of 10 and 15 years. The coupon (interest) rates for Category IV will be 7.29 per cent and 7.64 per cent for 10 years and 15 years respectively. For investors in Categories I, II and III, the coupon rates will be 7.04 per cent and 7.35 per cent for 10 years and 15 years respectively. The interests will be paid annually.
The bonds have been rated AAA/Stable by Credit Rating Information Services of India (Crisil) and ‘IND AAA/Stable’ by India Ratings. The instruments with these ratings carry low risk credit.
Aim is to raise Rs.3,500 crore for direct lending and refinancing irrigation projects.

Source : The Hindu