Muthoot Finance NCD-Series II Guidelines

• Issue Open: December 22, 2011
• Issue Closes: January 07, 2011
• Issue size: Rs, 300 Crore + Rs 300 Crore under Green Shoe Option
• Period of Holding: 2, 3 and 5 years
• Interest Rates
• Annual Option: 13%, 13.25% and 13.25% under 2, 3 and 5 years respectively
• Cumulative Option: Double in 5 yrs and 6 months.
• Minimum Investment: Rs 5,000/- and in multiple of Rs 1,000/- thereafter
• Issue Format: Compulsary in dematerialized form

Our Concern

Muthoot Finance NCD has a credit Rating given by CRISIL & ICRA as  AA-/Stable’ upto 600 Crore and we are not comfortable with this type of rating. it may look lucrative that rate of interest is high but along with it brings the risk of default which may happen due to credit rating which may be not in the interest of retail investors. The better options will be to go for infrastructure bonds which will be giving lesser rate of interest but will be compensating in form of income tax rebate and will be also better from safety point of view or one can invest in multibagger stocks 2012 to make real money in the market. You can read more about infrastructure bonds in below related posts.

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