IDFC tax-saving long-term infrastructure bonds Issue extended till 21st March 2011

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IDFC tax-saving long-term infrastructure bonds Issue extended till 21^st March 2011

 

 

 

Mumbai, March 16^th, 2011: Infrastructure Development Finance Company Limited (the “Company” or “IDFC”) is offering its third tranche of secured, redeemable, long term infrastructure bonds having tax benefits under Section 80 CCF of the Income Tax Act, 1961 (“Tranche 3 Bonds”) for an amount not exceeding Rs. 2,172 Crore (the “Issue”) on the terms set out in the prospectus dated February 21, 2011 filed with the Registrar of Companies, Tamil Nadu (the “Prospectus – Tranche 3”). After obtaining necessary internal approvals, the Company has extended the closing date of the ongoing Issue to the 21^st March 2011 from the earlier closing date of 16^th March, 2011. The Company has filed a corrigendum dated March 14, 2011 (the “Corrigendum”) with the Registrar of Companies, Tamil Nadu in connection with the extension of the closing date of the Issue. The Company and the Lead Managers to the Issue have intimated to the Securities and Exchange Board of India and the stock exchanges about the extension of the Issue closing date.

The closing date for the Issue has been extended to cater to investor interest in long term infrastructure bonds as a tax saving instrument.

Relevant dates: The Issue opened on 28^th February and will now close on 21^st  March, 2011. The Tranche 3 Bonds are being issued in two series, both with buyback options but with different interest payment options. The Tranche 3 Bondscan be subscribed in a lot of two Tranche 3 Bonds of Rs 5,000 each and in multiples of one Tranche 3 Bond thereafter. The Tranche 3 Bonds have a maturity of 10 years from the deemed date of allotment. The Tranche 3 Bonds are eligible for 80CCF tax benefits, which allow tax exemption on the initial investment up Rs 20,000.

Other all terms and conditions of the offer remain unchanged. For the benefit of investors, the terms are reproduced below:

The Tranche 3 Bonds can be bought physically or in demat form therefore it is not necessary for potential investors to have demat accounts. The Tranche 3 Bonds will be issued in two series-one with an annual return of 8.25 per cent and the other with a similar return but in a cumulative option and compounded annually.

The Issue has a lock-in period of five years, post which subscribers can sell the bonds. No trading would be permitted in the Tranche 3 Bonds during the said lock-in period.

After five years, The Tranche 3 Bonds will also be listed on the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE).

The profile on the each series of bonds under the second tranche is as under: 

Series	1	2
Frequency of Interest payment	Annual	Cumulative
Face Value per Tranche 3 Bond	Rs. 5,000	Rs. 5,000
Buyback# Facility	Yes	Yes
Buyback# Amount	Rs. 5,000 per Tranche 3 Bond	Rs. 7,435 per Tranche 3 Bond
Maturity Date	10 years from the Deemed Date of Allotment	10 years from the Deemed Date of Allotment
Interest Rate	8.25% p.a.	N.A.
Maturity Amount per Tranche 3 Bond	Rs. 5,000	Rs. 11,050
Yield on Maturity	8.25%	8.25% compounded annually
Yield on Buyback#	8.25%	8.25% compounded annually

#: after expiry of lock in 

About IDFC

IDFC is a leading knowledge-driven financial services company in India and plays a central role in advancing infrastructure development in the country. The Company provides a full range of financing solutions to its clients. Established in 1997 as a private sector enterprise by a consortium of public and private investors, the Company listed its Equity Shares in India pursuant to an initial public offering in August 2005.