Non-Convertible Debentures (NCDs) are fixed-income securities issued by corporations to raise funds from the public. Unlike convertible debentures, NCDs cannot be converted into equity shares of the issuing company. They offer a fixed interest rate (coupon) for a specified tenure and return the principal amount upon maturity.

Key Features

• Fixed Income: Provide regular interest payments (monthly, quarterly, annually, or cumulative) at a predetermined rate.
• Potentially Higher Returns: Often offer higher interest rates compared to bank fixed deposits (FDs) due to the associated credit risk.
• Secured vs. Unsecured: NCDs can be secured (backed by company assets) or unsecured. Secured NCDs are generally considered safer.
• Credit Rating: Rated by credit rating agencies (like CRISIL, ICRA) indicating the issuer's creditworthiness and ability to repay. Higher ratings (e.g., AAA, AA) suggest lower risk.
• Listing & Liquidity: Many NCDs are listed on stock exchanges (NSE/BSE), providing a degree of liquidity before maturity, although liquidity can vary.
• Minimum Investment: Face value is often low (e.g., Rs 1,000), but the minimum application size for public issues is typically around INR 10,000.

NCD Services We Offer

• Active Issue Listing: Providing information on currently available public NCD issues (Data integration placeholder).
• Risk-Return Analysis: Helping compare NCDs based on credit ratings, coupon rates, security status, and tenure.
• Application Assistance: Guidance on the application process through ASBA (Applications Supported by Blocked Amount) via your bank account.

Investment Considerations

Investors should carefully assess the credit rating, tenure, coupon rate, and security status of the NCD before investing. Higher yields usually come with higher risk. NCDs are suitable for investors seeking fixed returns higher than FDs and who understand credit risk. Interest earned is generally taxable as per the investor's income tax slab.