Rural Electrification Corporation (REC) Tax Free Bond

Rural Electrification Corporation (REC) Tax Free Bond

Tax free bonds have emerged as a popular investment option due to the taxation benefits they offer. The interest income on this bond is exempted from taxation.

  • AAA/Stable by CRISIL and AAA rating by CARE & ICRA makes it highly secure & safe regarding timely servicing of financial objectives
  • Notified as Public Financial Institution, Rural Electrification Corporation Ltd. is granted “NAVRATNA” status by virtue of its operational efficiency and financial strength
  • Government of India has rated RECs performance as “Excellent” continuously since 1994
  • These bonds are Listed, Tax Free, Secured, Redeemable, Non-Convertible and carry High Coupon Rates
  • Tax free Interest rates upto 8.88% per annum.(Comparable to 12.85% taxable Bonds/deposits for the highest tax brackets)
  • The default risk associated with the bonds is very low

Tenor of the bond

10 Years

15 Years

20 Years

Coupon Rate (p.a.) - Retail Individual Investors

8.44%

8.88%

8.86%

Coupon Rate (p.a.) - Other than Retail Investors

8.19%

8.63%

8.61%

 

Allotment will be made on a first-come-first-served basis.

 

Tax Free Secured Redeemable Non-convertible Bonds, in the nature of Debentures of REC will open on February 28, 2014 for subscription and is scheduled to close on March 14, 2014.Source

Note: This is not an investment recommendation, for more details and proper advice please contact your financial adviser 

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