What are important points about the Adani Enterprises Bond issue?
These are the main points that any prospective investor must keep in mind before investing in these bonds:
first-ever public bond issue from an Adani Group company for retail (₹10,000 or more) investors
offering open from 4-17 September, 2024
Rating of A+ from CARE. The bond issuer is Adani Enterprises
Taxation: slab rate on interest (10% TDS), 12.5% tax on capital gains after one year
Investment starts at ₹10,000 onwards, HNI category applicable after ₹10 lakhs
can be purchased online from bond trading platforms
yields are 9.25% (2 years), 9.65% (3 years), and 9.90% (5 years) for both annual (or quarterly) interest payments (yield = annual coupon) and cumulative options. Note: Cumulative returns will be higher than interest payout due to at-slab tax on coupon payments
As per news articles, the issue has been fully subscribed on the first day itself on 4th September at the time of market close at 4pm IST
Who should invest in Adani Enterprises Bond issue?
Investors who meet the first and at least 2-3 of the other categories may consider investing:
Understand the concept of concentration risk and will not be exposing too much of their total portfolio to one issuer (in this case the Adani group)
Understand that exiting the investment before maturity will be difficult unless somehow they can find a buyer for these bonds at an acceptable price (remember that if there are only a few buyers, they control the price)
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This post titled Adani Enterprises Bond Issue: Should You Invest? first appeared on 04 Sep 2024 at https://arthgyaan.com