Smart Money Inc. NHAI Bond - Bond with the Best

Hope this interest you...Check out the chart explaining how the return (interest) is better then FD...Remember Interest is TAX FREE.... Zoher 

With SENSEX FALLS 146 POINTS a AS BANKS Killer , RIL SLIP • • 9 Debut, NHAI Bonds Set to Raise . 10k cr ANURADHA HIMATSINGKA KOLKATA      Bonds floated by the National Highways Authority of India, or NHAI, sold like hot cakes on the first day with demand outstripping the offer within hours of opening, belying perception that people are averse to investing in infrastructure, which is getting a short shrift from the government. The success of the first retail bond sale by the nation's roads builder is due to the attractive post-tax returns from its bonds for as long as 15 years, when interest rates are poised to fall.  Interest rates and bond prices move in opposite direction.  Sovereign backing to the entity is another comforting factor for investors since their capital would be returned even if some of the projects funded turn unviable, or even if NHAI incurs losses. "The AAA-rated bonds seem attractive," said Rishi Nathany, a Kolkatabased financial planner.  "Moreover, since we are near the peak of the interest rate cycle, these bonds could see possible capital appreciation once rates start falling," he said.  NHAI, which is selling bonds to raise . 5,000 crore, received bids for at least . 7,000 crore, said a person involved in the deal. It has the option to retain an additional . 5,000 crore, which is known as a greenshoe option, taking the total size to . 10,000 crore. The issue may be closed ahead of its January 11 deadline due to strong demand.  Of the total issue, 40% is reserved for institutional investors and 30% each for the retail and high net worth individual (HNI) categories.      For individuals in the highest tax bracket of 30.9%, the 10-year 8.2% tax-free bond gives an effective return of about 11.87%, and the 15-year 8.3% bond, 12.01%. These are better than bank fixed deposits that are taxed even if they offer as high as 9.5% or 10%.  "Unlike tax-saving bonds from institutions like IDFC or even L&T Finance, interest income from NHAI bonds is exempt from income-tax levy," said G Suresh, chief general manager, NHAI. "This makes the instrument an attractive investment option. This apart, there is no cap on the investment amount per application."

--
Disclaimer
Information, charts or examples contained in this mail is for illustration and educational purposes only. It should not be considered as advice or an endorsement to purchase or sell any security or its financial instrument until you are well conversant and confident about the movement.
 
For indiviual guidance please write to me seperately at zoherdoctor@gmail.com
 
 
Visit Us at: www.smartmoneydirect.co.in
You received this message because you are subscribed to the Google Groups "Smart Money Inc." group.
To post to this group, send email to smartmoneyinc@googlegroups.com
To unsubscribe from this group, send email to smartmoneyinc-unsubscribe@googlegroups.com
For more options, visit this group at http://groups.google.com/group/smartmoneyinc?hl=en