REC Infrastructure Bonds 2012

Rural Electrification Corporation Limited (REC), a NAVRATNA Central Public Sector Enterprise under Ministry of Power, was incorporated on July 25, 1969 under the Companies Act 1956. REC a listed Public Sector Enterprise Government of India with a net worth of Rs. 12,789 Crore as on 31.03.11. Its main objective is to finance and promote rural electrification projects all over the country. It provides financial assistance to State Electricity Boards, State Government Departments and Rural Electric Cooperatives for rural electrification projects as are sponsored by them.
REC Limited is issuing series of Long Term Infrastructure Bonds for financial year 2011 – 12. Eligible investors include Resident Indian Individuals (Major) and HUFs through Karta of the HUF . These bonds are Unsecured, Redeemable, Non-Convertible Long Term Infrastructure Bonds, having benefits under section 80 CCF of the Income Tax Act, 1961 for investment upto Rs.20,000/-. 

Issue opens: December 19, 2011

Issue closes: February 10, 2012

Issue Structure: 

Maturity Period : The Bonds, with a maturity of ten and fifteen years, will be issued in four series.
Series-1:  Annual option with 8.95%, payable annually; with a buyback option after 5 years#
Series-2: Cumulative option with 8.95%, compounded annually; with a buyback option after 5 years#

Series-3:  Annual option with 9.15%, payable annually; with a buyback option after 7 years#
Series-4: Cumulative option with 9.15%, compounded annually; with a buyback option after 7 years#

#: after expiry of lock in

Website: http://recindia.nic.in/infra.html

Series	1	2
Face Value	Rs 5000 per bond	Rs 5000 per bond
Minimum number of bonds per application	Minimum One + Multiples of One	Minimum One + Multiples of One
Interest payment	Annual	Cumulative
Interest Rate	8.95% p.a.	8.95% p.a.
Maturity Amount per Bond	Rs 5,000	Rs 11,783
Maturity	10 years from the deemed date of allotment	10 years from the deemed date of allotment
Yield on Maturity	8.95%	8.95% compounded annually
Buyback Facility	Yes	Yes
Yield on Buyback	8.95%	8.95% compounded annually
Buyback Date	Date following 5 years and one day from the deemed date of allotment	Date following 5 years and one day from the deemed date of allotment
Buyback Amount	Rs 5,000 per bond at end of 5 years	Rs 7,677 per bond at end of 5 years
Buyback Intimation Period	N.A.	N.A.

Series	3	4
Face Value	Rs 5000 per bond	Rs 5000 per bond
Minimum number of bonds per application	Minimum One + Multiples of One	Minimum One + Multiples of One
Interest payment	Annual	Cumulative
Interest Rate	9.15% p.a.	9.15% p.a.
Maturity Amount per Bond	Rs 5,000	Rs 18,592
Maturity	15 years from the deemed date of allotment	15 years from the deemed date of allotment
Yield on Maturity	9.15%	9.15% compounded annually
Buyback Facility	Yes	Yes
Yield on Buyback	9.15%	9.15% compounded annually
Buyback Date	Date following 7 years and one day from the deemed date of allotment	Date following 7 years and one day from the deemed date of allotment
Buyback Amount	Rs 5,000 per bond at end of 7 years	Rs 9,231 per bond at end of 7 years
Buyback Intimation Period	N.A.	N.A.

[Source: http://recindia.nic.in]