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    Non Convertible Debentures

    NCDs are
    Fixed Income Instruments for Assured Returns

    Non Convertible Debentures (NCDs) or Bonds are debt investments in which you lend money to a corporate or government entity that borrows the funds, for a specified period of time at a fixed interest rate.

    NCDs are suitable for

    • Stable consistent return with least risk
    • Consistent periodic return rather than lump sum return
    • Low risk appetite
    • Diversification of portfolio with debt instrument

    Reasons to Invest in NCDs/Bonds


    Reduce Risk with NCDs

    Lower Risk

    NCD reduces your risk as they are backed by the company's assets.

    Higher ROI with NCDs

    Higher ROI

    Return is relatively higher in NCDs than a lot of other investment avenues.

    Tax Exemptions with NCDs

    Tax Exemptions

    No income tax is deductible at source as per the provisions of Sec 193 of the IT Act.

    NCD Locking period

    Liquidity

    NCDs are listed and traded on the exchange, hence providing liquidity to the investor.

    NCD Credit Rating

    Credit Rating

    Agencies like CARE, FITCH, CRISIL, ICRA rate NCD's that are good indicator of quality of debt paper.

    NCD made Easy

    Convenience

    As NCDs are only in Demat online form, it is easier to handle and track.

    Features of NCD

    • Issue:

      • Non-convertible debentures are offered by companies through an open issue. Investors can buy the same in the primary market when the issue is open. They can also choose to purchase NCDs being traded on the stock market at a later point in time.

    • Credit rating:

      • Companies with good credit ratings are permitted to issue NCDs. Further, each issue of NCD is rated by credit agencies as well. These ratings can change based on the companies’ performance and their ability to honour the NCDs.

    • Interest rate:

      • The higher the credit rating of an issue, lower will be the interest rate offered. Most NCDs can also earn based on growth of the underlying asset.

    • Return on investment:

      • NCDs generally offer a higher return on investment compared to risk-free return earned on fixed deposits and government bonds. At the moment, the returns on NCD can be up to 11% per annum.


    Reliance Securities is a distributor of Mutual Funds, Portfolio Management Services(PMS), Corporate Fixed Deposits, Bonds/NCDs, Insurance, IPOs, Structured Products and Loans.