IDFC BOND ISSUE

IDFC BOND ISSUE
FREQUENTLY ASKED QUESTIONS
What is a Bond?
A Bond is a debt instrument where the issuer of the Bond agrees to repay the
investor, the amount borrowed and interest, over a specified period of time.
How are Bonds different from Fixed Deposits?
Bonds are similar to Fixed Deposits. Like Bonds, fixed deposit receipts are normally
issued by a bank, a financial institution or a company, for a fixed period. A specified
rate of interest is payable to the investor at regular intervals. However, unlike Bonds,
Fixed Deposits are not transferable. Also, while Bonds may be secured or
unsecured, Fixed Deposits are always unsecured.
What is Tax Saving Bond?
A Tax Saving Bond is a bond, the proceeds of which are to be deployed in
accordance with the Income Tax Act, 1961 in infrastructure projects. The greatest
attraction of it is the tax rebate available under Section 80CCF of the Income Tax
Act, 1961 in the year in which the amount is invested. Tax saving bond can either
pay you interest regularly (say annually which can be annual or monthly or quarterly)
or it can be in the nature of deep discount bond.
What is IDFC Bond?
IDFC had allotted “Long Term Infrastructure Bonds” having face value of Rs.5000/each in the nature of Secured, Redeemable, Non-convertible Debentures, having
benefit under Section 80CCF of the Income Tax Act, 1961.
What is the Offer Document pursuant to which Bonds were offered to Investors
by IDFC?
Prospectus Tranche 1 dated September 23, 2010 read with Corrigendum dated
October 8, 2010.
When the Bonds were allotted?/What is the Date of Allotment of Bonds?
The Bonds were allotted on November 12, 2010.
When the Bonds were credited to the demat account of the Investors who
desired the bonds in dematerised form?
The Bonds were credited to the demat account of the Investors on November 13,
2010.
When the Allotment Advice and other documents were sent to the Investors
who desired the bonds in dematerised form?
The Allotment Advice and Buyback Intimation (in respect of Series 3 and 4) were
sent to the Investors under certificate of posting on November 15/16, 2010.
When the Bond Certificate, Allotment Advice and other documents were sent to
the Investors who desired the bonds in physical form?
The Allotment Advice, Bond Certificate, Buyback Intimation (in respect of Series 3
and 4) and Nomination Request letter were sent to the Investors by Registered Posty
on November 15/16, 2010.
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Grounds on which the Application Forms for Bonds were rejected?
In response to public Issue of Bonds, IDFC had received 2,41,118 Application Forms
for allotment of 9,68,612 Bonds. Out of the aforesaid Application Forms, 7,072
Applications Forms were rejected on the following grounds.
(a)
Applications submitted by –
(i)
SEBI barred entities;
(ii)
Partnership Firms
(iii)
Non-resident Indians
(iv)
Foreign Nationals
(v)
Foreign Institutional Investors
(vi)
Overseas Corporate Bodies.
(b)
(c)
(d)
(e)
(f)
Applications without PAN details
Applications made by Investors who have in-active DP Account
Applications for less than two bonds or not supported by sufficient fund
Applications submitted by Minor
Applications not signed by the Applicant
What are reasons due to which I have not received the Bond
Certificate/Allotment Advice?
1. Non-receipt of Bond Certificate / Allotment Advice due to postal problem:
The Bond Certificates / Allotment Advice along with other documents have been
sent to the Bondholders on November 15/16, 2010 by the Registered Post. Due
to Postal problems, some of the Bonds Holders have not received by the
aforesaid document.
2. Applications not supported by Identity/Address proof (KYC documents):
Applications were received without sufficient KYC documents from applicants
who wished to subscribe to the Bonds in Physical Form. Since, it was difficult to
establish whether they were submitted along with application and was lost
inadvertently either at the broker’s end/banker’s end or the investor has not
submitted one or more of them, it was decided to accept all such applications as
valid for allotment. However, it was decided to send only an allotment advice
along with a letter calling for missing documents and release the bond certificate
on receipt of the same.
The Investors are requested to send KYC documents to Karvy Computershare
Private Limited at the address given below.
3. In-active/incorrect DP & Client ID: Few Applications were received without
Demographic details of the Applicant. It was decided to consider the
applications as valid and the Bonds allotted were credited to a demat account
opened by the registrars to the issue and will be subsequently released to the
applicants concerned either on activation of their account or on provision of
fresh / new valid active beneficiary account by them. A suitable communication
in this regards has been sent to the investors concerned requesting them to take
steps to activate their beneficiary accounts or provide details of fresh accounts
for doing the needful.
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What is the benefit of investing in IDFC Bonds?
Investment in IDFC Bonds issued up to March 2010 are eligible for tax rebate under
Sec 80CCF up to Rs.20,000/-. This rebate is over and above Rs.1,00,000/- benefit
under section 80C, 80CCC and 80CCD
What is the tenure & lock-in period of these Tax Free Infrastructure Bonds?
The Tenure of IDFC Bonds is 10 years and the same have a lock-in of 5 years from
the Date of Allotment November 12, 2010. The Bonds issued under Tranche 1
Prospectus dated September 23, 2010 read with the corrigendum dated October 8,
2010 will mature on November 12, 2020 and will be lock-in till November 11, 2015.
What are the different Series of Bonds that were allotted by IDFC on November
12, 2010?
IDFC had allotted the Bonds, with a maturity of ten years, of the following four series.
Series-1: Carry a 8% coupon, payable annually
Series-2: Cumulative option, 8% coupon, compounded annually
Series-3: Carry a 7.50 % coupon, payable annually; with a buyback
option*
• Series-4: Cumulative option, 7.50% coupon, compounded annually; with
a buyback option*
* after expiry of lock-in period
•
•
•
What are the important terms for each Series of Bonds issued on November 12,
2010?
SPECIFIC TERMS FOR EACH SERIES OF BONDS UNDER THE FIRST
TRANCHE
Series
Face Value
Minimum
number of
Bonds per
application*
Terms of
Payment
Interest
payment
Interest Rate
1
3
4
Rs.5000 per bond
Two Bonds and in multiples of one Bond thereafter.
For the purpose of fulfilling the requirement of minimum subscription of two Bonds, an Applicant
may choose to apply for two Bonds of the same series or two Bonds across different series.
Full amount with the Application Form
Maturity
Amount per
Bond
Maturity
Yield on
Maturity
Buyback
Facility
Yield on
Buyback
Buyback
Amount
2
Annual
Cumulative
Annual
Cumulative
8.00% p.a.
N.A.
7.50% p.a.
N.A.
Rs.5,000
Rs. 10,800
Rs. 5,000
Rs. 10,310
8.0%
N.A.
November 12, 2020
8.0% compounded
7.50%
annually
N.A.
Yes
N.A.
N.A.
N.A.
Rs. 5,000/per Bond
7.50% compounded
annually
Rs. 7,180/per Bond
Buyback Date N.A.
N.A.
November 13, 2010
November 13, 2010
Buyback
Intimation
Period
N.A.
February 12, 2015 to February 12, 2015 to
May 12, 2015
May 12, 2015
N.A.
N.A.
7.50%
7.50% compounded
annually
Yes
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Credit Rating
IDFC Bonds have been rated "LAAA" by ICRA indicating the highest degree of safety
for your money.
Listing
Bonds are listed on National Stock Exchange of India Limited (NSE) and Bombay
Stock Exchange Limited.
Dealing in Bonds
Due to the nature of Infrastructure Bonds and lock-in requirement, Dealing in these
Bonds will not be permitted for a period of five (5) years from the date of allotment
i.e. November 12, 2010. Post expiration of the aforesaid period of 5 years, the bonds
can be traded on the Stock Exchanges.
What is the procedure for redemption of bonds?
For bonds held in physical form, the bondholders are required to surrender the bond
certificates duly discharged by the sole holder/ all the joint holders at least one
month prior to the redemption date. IDFC may however redeem the bonds without
requiring the surrender of bond certificates. In such a case, the redemption
proceeds would be paid to those bondholders whose names appear in the Register
of Bondholders as on the record date fixed for this purpose.
In case of bonds held in electronic form, no action is required on part of the
Bondholders and the redemption proceeds would be paid to those bondholders
whose names appear on the list of beneficial owners given by the Depositories to
the Company.
What information should I provide in a correspondence to IDFC to facilitate a
quick response to my queries?
Kindly provide the following information to facilitate a quick response:
•
DP & Client ID (in case of Bonds are applied in denaturized form)
•
Application Number
•
Name and Address of bondholder.
•
Folio Number
•
Bond Certificate Number (in case of Bonds are applied in physical form)
All these details are available on the Bond Certificate.
How to change the address on record in case of Bonds held in Physical Form?
A request letter mentioning the change in the address along with the self certified
proof of the new address is to be sent to the Registrar’s office at the below
mentioned address.
Karvy Computershare Private Limited
Unit: IDFC Bonds – Tranche 1
Plot No. 17 to 24
Vittal Rao Nagar Madhapur
Hyderabad - 500 081
How to change the address on record in case of Bonds held in Demat Form?
The Bonds holders have to approach their Depository Participant with whom they
maintain their Demat Account for changing their address. No request, pertaining to
change in address for bonds held in Demat Form should be sent to the Company or
its Registrar.
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How to change the bank details on record in case of Bonds held in Physical
Form?
A request letter mentioning the new bank details i.e. name of the bank, branch and
account number duly signed by the Bondholder (in case of Joint holding, duly
signed by the all the joint holders or the first Bond Holder) is to sent to the
Registrar’s office at the below mentioned address.
Karvy Computershare Private Limited
Unit: IDFC Bonds – Tranche 1
Plot No. 17 to 24
Vittal Rao Nagar Madhapur
Hyderabad - 500 081
How to change the bank details on record in case of Bonds held in Demat
Form?
The Bonds holders have to approach their Depository Participant with whom they
maintain their Demat Account for changing their address. No request, pertaining to
change in Bank Details for bonds held in Demat Form should be sent to the
Company or its Registrar.
How to change the bank mandate on record in case of Bonds held in Physical
Form?
A request letter mentioning the bank details i.e. name of the bank, branch and
account number duly signed by the Bondholder (in case of Joint holding, duly
signed by the all the joint holders or the first Bond Holder) along with a copy of
cancelled cheque be sent to the Registrar’s office at the below mentioned address.
Karvy Computershare Private Limited
Unit: IDFC Bonds – Tranche 1
Plot No. 17 to 24
Vittal Rao Nagar Madhapur
Hyderabad - 500 081
How to change the bank mandate on record in case of Bonds held in Demat
Form?
The Bonds holders have to approach their Depository Participant with whom they
maintain their Demat Account for change in the Bank mandate. No request,
pertaining to change in Bank mandate for bonds held in Demat Form should be sent
to the Company or its Registrar.
What is the communication address for matters relating to IDFC Bonds?
All communication regarding to IDFC Bonds may be sent to Karvy Computershare
Private Limited at the address given below.
Karvy Computershare Private Limited
Unit: IDFC Bonds – Tranche 1
Plot No. 17 to 24
Vittal Rao Nagar Madhapur
Hyderabad - 500 081
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Where can I email my queries relating to IDFC Bonds?
All emails pertaining to IDFC Bonds should be marked to : [email protected] /
[email protected]
What is the contact number to get information about Allotment of IDFC Bonds?
(1) Ms. Hema Ramamurthy
Contact no.: 022-42222349 (Extn: 22349)
e-mail id: [email protected] / [email protected]
(2) Ms. Sharayu Desai
Contact No. 022-42222337
e-mail : [email protected] / [email protected]
(3) Toll-free Number: 1800-3454001
How can I check the status of Bonds allotted to me on-line?
The Bondholders can check online status for the details of Bonds allotted to them
through the link and following process given below:
http://karisma.karvy.com ---> click ---> IPO Allotment Status ---> Select Company
– IDFC ---> Application No.
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