Housing and Urban Development Corporation (HUDCO) is issuing tax free bonds with a face value of Rs 1,000 each in the nature of secured, redeemable, non-convertible debentures having benefits under section 10(15)(iv)(h) of the Income Tax Act, 1961, as amended, aggregating Rs 2,000 crore with an option to retain an oversubscription of up to Rs 4,684.72 crore (shelf limit).
The minimum application size is ten (10) bonds and in multiples of one (1) bond thereafter. The issue will open on January 27, 2012, and will close on February 6, 2012, or earlier, or may be extended by such period, upto a period of 30 days from the date of opening of the issue, as may be decided by the board of the company or by a duly constituted committee.
The bonds carry a coupon rate of 8.10% for Tranche-I Series 1 Bonds and 8.20% for Tranche-I Series 2 Bonds on per annum basis. Additional coupon rate of 0.12% per annum for Tranche-I Series 1 Bonds and 0.15% per annum for Tranche-I Series 2 Bonds shall be payable to the allottees under Category III which will aggregate to coupon rates of 8.22% and 8.35% respectively. However, the aforesaid additional interest of 0.12% p.a. and 0.15% p.a. shall only be available to the original allottees of the bonds under Category III, and shall not be available to the bondholders of such bonds under certain instances. The bonds are proposed to be listed on NSE and BSE.
The Tranche-I Bonds have been rated 'CARE AA+' by CARE indicating high degree of safety for timely servicing of financial obligations & carry very low credit risk and 'FITCH AA+ (ind)' by FITCH indicating Outlook on National long-term rating is stable.
The Tranche-I Series 1 bonds and Tranche-I Series 2 bonds can be redeemed after ten (10) years and fifteen (15) years respectively from the deemed date of allotment. The bonds can be issued in both dematerialized and physical form but trading can happen only in dematerialized form. The issue price for both the series is Rs 1,000 per bond.
There are 3 categories of investors who can apply to the issue – Category I, Category II and Category III. Category I includes public financial institutions, statutory corporations, scheduled commercial banks, co-operative banks, regional rural banks, provident funds, pension funds, superannuation funds, gratuity funds, insurance companies, national investment funds, mutual funds, companies, bodies corporate, societies, public, private charitable/religious trusts, scientific organizations, industrial research organizations, partnership firms and limited liability partnerships.
Category II includes resident Indian individuals and Hindu Undivided Families applying for an amount aggregating to above Rs 5 lakh across all series in the tranche. Category III will include resident Indian individuals and HUFs applying for an amount aggregating to upto and including Rs 5 lakh across all series in the tranche.
The lead managers to the issue are Enam Securities Private Limited and SBI Capital Markets Limited. The debenture trustee to the issue is SBICAP Trustee Company Limited.
Updated: Housing and Urban Development Corporation Limited (HUDCO) has announced extension of closing date of HUDCO Tax Free bonds by 4 days. Accordingly, the bonds which were scheduled to close on February 6, 2012 will now close on February 10, 2012.
The bonds carry a coupon rate of 8.10% for Tranche-I Series 1 Bonds and 8.20% for Tranche-I Series 2 Bonds on per annum basis. Additional coupon rate of 0.12% per annum for Tranche-I Series 1 Bonds and 0.15% per annum for Tranche-I Series 2 Bonds shall be payable to the allottees under Category III which will aggregate to coupon rates of 8.22% and 8.35% respectively.