Tag: Bonds

India’s inclusion in Bloomberg EM bond indices FAQs: Effective date, eligibility conditions and more

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Bloomberg announced on Tuesday, March 5, that India’s Fully Accessible Route (FAR) bonds will be included in the Bloomberg Emerging Market (EM) Local Currency Government Index and related indices.

This inclusion will be take place over a 10-month period, starting January 31, 2025, with an initial weight of 10% of their full market value.

This comes about five months after JP Morgan had announced that it would include India in its widely-tracked emerging market debt.

Here are FAQs on this new inclusion by Bloomberg:

[faq][ques]Which indices will the Indian FAR bonds be included in, and what is the timeline for their inclusion?[/ques][ans]Indian FAR bonds will be included in the Bloomberg EM Local Currency Government indices, with an initial weight of 10% of their full market value. The weight of these bonds will be increased in increments of 10% of their full market value every month over the 10-month period ending in October 2025. The indices include the Bloomberg EM Local Currency Government Index, the Bloomberg EM Local Currency Government Index 10% Country Capped Index, and all related sub-indices.[/ans][/faq]

[faq][ques]Why is India not eligible for inclusion in other Bloomberg indices, such as the Global Aggregate Index, at this time?[/ques][ans]India continues not to be included in the Bloomberg Global Aggregate and related indices. Bloomberg is actively monitoring market developments in India with a view to understanding the compatibility of FAR bonds with the Global Aggregate. The decision to include or not is influenced by market complexities, unique local practices, and scale issues.[/ans][/faq]

[faq][ques]What conditions need to be satisfied for India to be included in the Global Aggregate Index?[/ques][ans]Various factors need consideration, including repatriation challenges, capital gains tax approvals, short trading windows, account opening processes, funding challenges with margin requirements, and custodian readiness.[/ans][/faq]

[faq][ques]Is the inclusion of India bonds in the EM bonds index permanent, and what could lead to their exclusion?[/ques][ans]The inclusion is subject to the investability of these bonds and unforeseen operational hurdles. A significant reduction in investability or other operational issues that hinder investors from replicating index returns could lead to exclusion.[/ans][/faq]

[faq][ques]How often will changes to the indices be made once India bonds are fully included?[/ques][ans]The Bloomberg EM Local Currency Government Index and related indices are rebalanced monthly on the last business day, as outlined in their methodologies.[/ans][/faq]

[faq][ques]What factors led to the inclusion of India bonds in this index, and has there been any change in regulation or market structure that enabled this?[/ques][ans]India’s efforts to enhance accessibility, including the FAR programme, extended trading hours, alternative margin posting methods, and improved account registration, contributed to the decision. Bloomberg has been discussing India’s inclusion for the past four years, with the recent market consultation initiated based on client feedback during the Bloomberg 2023 Fixed Income Index Advisory Councils.[/ans][/faq]

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Bloomberg to add India to EM bond indices from Jan 31, 2025

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

In DBS Bank, a flow in of $3-4 billion is expected due to inclusion in Bloomberg EM bond index. Inflow will be lesser as the inclusion is in the EM index and not the BBG global bond index.

Ashhish Vaidya, Managing Director and Head of Treasury and Markets, DBS Bank India said, “This is a Bloomberg Emerging Market Index, so it has a much smaller AUM under consideration. We expect atleast $3-4 billion to come in because of this inclusion. The larger index is the global Bloomberg index. Market was speculating earlier that India will be included as a part of the global index, so if that was the case the amounts would have been much larger.”

In Kotak Mahindra Mutual Funds, a $2.5-3 billion flow in is expected with the inclusion in Bloomberg index.

Lakshmi Iyer, Kotak Mahindra AMC said, “This is the emerging market part of the Bloomberg index where the total incremental amount will be roughly about $2.5-3 billion. The Bloomberg aggregate where the total size is over $3 trillion, probably this could be a baby step in the making. But any form of inclusion is welcome. When the announcement ab-initio happened, the market was speculating that it will be larger index first and that would have shrunk the bond yields to as low as 7%, but small steps are always a happy thing to be.”

She added, “It also coincides at a time where Indian currency is having a dream innings in terms of being the most stable currency across the world in the last 18 months. So from a long to medium term perspective it would still have a positive rub-off effect on bond yields which will get much more attractive from a foreign investors standpoint.”

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

India’s municipal bond index marks one-year anniversary with 8.72% returns

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

February 2024 will mark the first anniversary of the pioneering municipal bond index. As of February 9, 2024, the index has delivered a commendable 8.72% in returns, highlighting the growing interest and stability. Currently featuring 28 municipal bonds issued by 10 different issuers, all boasting credit ratings in the AA category, the index encompasses diverse maturities.

The municipal bond index has been an important step towards helping municipalities raise money by tapping the capital market. Recently, Martin Raiser, Vice President for South Asia at the World Bank told CNBC TV-18, that the bank is looking to push for more municipal bonds in India. Raiser emphasized the importance of municipalities utilizing local capital markets for financing. He highlighted the potential for well-managed municipalities to tap into this source of funding, with the World Bank ready to assist those not yet considered creditworthy through credit enhancement techniques.

“Municipalities in India have the advantage of developed capital markets, but the issuance of bonds from these entities is still relatively limited. We have plans to assist in this area, but there is substantial work to be done,” stated Martin Raiser.

So, what exactly does the municipal bond index represent? It monitors the performance of municipal bonds issued by various Indian municipal corporations, adhering to the Securities Exchange Board of India’s Issue and Listing of Municipal Debt Securities Regulations, 2015. Acting as debt instruments, these bonds are issued by local government bodies to raise funds for crucial infrastructure projects.

Investors in municipal bonds essentially lend money to municipalities, receiving periodic interest payments and the principal amount upon maturity. This form of investment plays a pivotal role in financing urban development and public projects while providing investors with a relatively stable investment option.

The constituent bonds within the index are assigned weights based on their outstanding amounts. Utilizing the total return methodology, factoring in both price and coupon returns, the index’s computation guarantees a holistic assessment of performance. With a base date set at January 1, 2021, and an initial value of 1000, the index undergoes quarterly reviews to maintain its relevance and accuracy.

The municipal debt security regulations came into effect in 2015. Here’s a look at the index value movement since then.

Source: NSE

Although the municipal bond index is just a year old in India, the bonds were allowed by the government in 2015. The concept has been around for a while globally. One of the oldest municipal bond indexes in the world is the Bond Buyer Municipal Bond Index in the United States. Established in 1911, this index tracks the average yields of 25 general obligation municipal bonds. Another notable municipal bond index with a long history is the S&P Municipal Bond Index.

For retail investors how much sense does it make? However, Just like any other bonds these bonds carry credit riisk, interest rate volitality risk and liquidity risk.

“Retail investors are better off with well managed high credit quality debt mutual funds where the fund manager can preperly select bonds after a thorough due delligence as retail investors may not undertand the risks associated while purchasing bonds directly. Just because these bonds are issued by local government bodies it does not mean they are fully safe and secured. Investors looking for soverign grade safety can look at G-Sec mutual funds, RBI Bonds and Post Office Schemes. Apart from this investors can also look at investing in high credit quality corporate bond funds as well. Yields are still elevaled and the interest rate cut cycle has not yet begun, investors can look at investing in medium and/or long duration products,” says Rushabh Desai, Founder, Rupee with Rushabh Investment Services.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

India bonds may be included in Bloomberg EM index from September: Statement

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Bloomberg Index Services on Monday proposed including eligible Indian bonds in its emerging market local currency index from September, a move that could lead to billions of dollars of inflows into the country.

The proposal comes just a few months after JPMorgan said it would include India in its widely tracked emerging market debt index from June.

The Indian government began discussing the inclusion of its securities in global indexes as far back as 2013 but restrictions on foreign investment in domestic debt hampered the process.

In April 2020, the Reserve Bank of India introduced securities that were exempt from foreign investment restrictions under a “fully accessible route” (FAR).

“Under the proposal, inclusion of India FAR bonds in the Bloomberg EM Local Currency Indices is to be phased in over a five-month period starting in September 2024,” the index provider said in a statement

Gaura Sengupta, India economist at IDFC First Bank, said India’s inclusion in the index would result in inflows of $2 billion to $3 billion over a five-month period.

India will continue to be excluded from the Bloomberg Global Aggregate and related indices, the statement said.

Also Read: Big tech aids Nasdaq’s best single-day gain in two months, Boeing tumbles

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Bank of Baroda raises ₹2,500 crore via Basel III compliant tier II bonds

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

State-owned Bank of Baroda on Thursday (December 21) said it raised ₹2,500 crore on December 20, 2023, through the issuance of Basel III compliant tier II Bonds Series XXV.

The bank received a total of 88 bids amounting to ₹6,803 crore against the base issue size of ₹1,000 crore (which translates to 6.8 times the base issue size) and a greenshoe option to retain oversubscription up to ₹1,500 crore.

The bank accepted bids for ₹2,500 crore at a coupon of 7.75% per annum, according to a stock exchange filing.

These bonds are unsecured, listed, rated, subordinated, non-convertible, taxable, and redeemable, having a tenure of 10 years from the deemed date of allotment with a five-year call option.

Also Read: Jyoti CNC Automation gets SEBI nod for IPO launch

The allotment of these bonds took place on December 21, 2023. Under Basel-III capital regulations, banks globally need to improve and strengthen their capital planning processes.

Bank of Baroda reported an operating profit of ₹8,020 crore, up 33% from the year-ago period. The lender’s profit after tax came at ₹4,253 crore, up from ₹3,313.4 crore in the corresponding period in the previous year. As per a CNBC-TV18 poll, the PAT was projected as ₹3,921.5 crore. The bank had reported a net profit of ₹4,070.1 crore for the April to June 2023 quarter.

The lender’s net interest income or NII — the difference between the revenue generated expenses that occurred during the period — rose 6.5% to ₹10,831 crore. This was below the estimated ₹11,058.8 crore. In the July-September quarter last year, the NII came at ₹10,174.5 crore.

Also Read: Cochin Shipyard wins Defence Ministry contract worth ₹488 crore

Shares of Bank of Baroda Ltd ended at ₹224.75, up by ₹5.55, or 2.53%, on the BSE.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

HDFC Bank raises ₹7,425 crore via bonds for infrastructure and affordable housing projects

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

India’s largest private sector lender HDFC Bank on Wednesday (December 20) announced the successful mobilisation of ₹7,425 crore through the issuance of non-convertible bonds.

The bank, via a private placement, issued 7.71% unsecured, redeemable, long-term, fully paid-up, non-convertible bonds in the form of debentures. This strategic funding initiative aims to support crucial infrastructure and affordable housing projects.

The regulatory filing confirmed the issuance of 7,42,500 bonds, each with a face value of ₹1 lakh. The funds generated through this issuance will be directed toward funding initiatives that contribute to the development of infrastructure and affordable housing projects.

Also Read: Infosys surprises employees with revised salaries, average pay hike below 10%

HDFC Bank reported a 9.3% rise in net profit at ₹15,976 crore for the quarter ending September 2023 compared to CNBC-TV18 poll’s forecast of ₹14,616.5 crore. The bank’s net interest income (NII) for the quarter stood at ₹27,385 crore, slightly below CNBC-TV18’s projected NII of ₹28,187.4 crore.

The lender also disclosed key asset quality metrics, including gross non-performing assets (GNPAs) at ₹31,578 crore, representing 1.34% of gross advances, and net NPA at ₹8,073 crore, accounting for 0.35% of net advances. Additionally, the bank set aside provisions totalling ₹2,904 crore.

HDFC Bank’s return on assets (RoA) was reported at 1%, annualised at 2% for the first half of FY24. The net interest margin was at 3.4%, while the core net interest margin stood at 3.65%. The bank’s pre-provision operating profit reached ₹22,694 crore. The gross advances stood at ₹23.54 lakh crore.

Also Read: India plans to tweak SEZ Act to allow economies of scale for domestic companies

Shares of HDFC Bank Ltd ended at ₹1,656.20, up ₹3.15, or 0.19%, on the BSE.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Jio Financial Services in talks with merchant bankers for maiden bond issue

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Jio Financial Services is in early talks with merchant bankers for its maiden bond issue, four bankers told Reuters on Monday. The company may look to raise ₹5,000 crore ($600.6 million) to ₹10,000 crore through the issue and may tap the market in the last quarter of this financial year, the bankers added.

Jio Financial, which was carved out of Reliance Industries, is in the process of  getting its credit rating and other necessary approvals, they said. The bankers declined to be identified as they are not authorised to speak to the media, while Jio Financial did not immediately reply to Reuters’ email for comment.

The company, which was listed in August, plans to establish itself as a full-service financial services firm in a rapidly growing market, including auto, home loans and other products, competing with the likes of Bajaj Finance.

“Jio Financial has got a strong promoter parentage and it is expected that the company will automatically get AAA credit rating,” said Venkatakrishnan Srinivasan, founder and managing partner at Rockfort Fincap.

“While the pricing will depend on factors like tenor and balance sheet size of the company at the time of issue, being an NBFC, it will be 10-20 basis points higher than RIL.” Earlier this month, Reliance Industries raised 200 billion rupees via 10-year bonds in the largest issue by a non-financial Indian firm, paying 40 basis points more than the government’s borrowing cost.

Ahead of the bond issue, bankers have recommended that Jio Financial issue shorter-term commercial papers and put bank borrowing lines in places to establish pricing, said two bankers.

It has also been recommended to issue bonds not longer than five-year maturity, according to four bankers.

“Since the company is new, the documentation and compliance will take time, and we could see them coming in before end of March” a merchant banker with a private bank said.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Bottomline | Why US debt woes may be an opportunity

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Global rating agency Moody’s has changed its outlook on US sovereign debt to negative even as it has retained the top Aaa rating. The move suggests a step towards a downgrade if financial conditions don’t improve. At the core of Moody’s concerns is unbridled fiscal spending. “In the context of higher interest rates, without effective fiscal policy measures to reduce government spending or increase revenues, Moody’s expects that the US’ fiscal deficits will remain very large, significantly weakening debt affordability,” the agency said.

It is important to note here that Moody’s isn’t the first to caution on the deterioration in US fiscal health. Fitch had in August cut its rating to AA+ from AAA. While a potential downgrade is a key risk to factor in for investors, and it could push yields higher to factor in the cut, it is unlikely to cause a significant stir for two reasons: first, much of the fiscal health has already been factored in by the markets, and second, US debt is still among the safest bets for large investments in the world.

Given this, let’s look at what this development and the “higher for longer (rates)” stance of central banks can spell for investors.

What history tells us

Bond markets in the US, like any other, have had their share of tops and troughs. No market has a linear move, and this provides patient investors an opportunity for gains. Interest rates being higher for longer is good news for investors as it allows them more time to lock-in funds for the long term at higher yields.

A look at how the US market has behaved over the years suggests a sharp decline in yields after every top. The median and mean declines from tops to troughs since 1981 stand between 43% and 44.3%. Even the most recent three instances have seen drawdowns between 25% and 36.5%. These sharp moves present significant opportunities also for capital gains.

Here, the unprecedented rise in yields in the recent past needs to be appreciated. US bond yields have moved up from a low of 0.38% in 2018 to a high of 5% in October 2023—that’s in just five years. In contrast, yields, after hitting a high of 7.9% in November 1994, dipped to a low of 2% in June 2008. That’s a good thirteen-and-a-half years for a 6% move. And while we did see a big move from 15.8% in September 1981 to 10.2% in February 1983, in terms of percentage change, it is clearly dwarfed by the recent move to a high of 5%. What this suggests is that any correction of this unprecedented move, if and when it occurs, could be swift and big.

Source: Investing.com

But the big question on everyone’s mind is: Have interest rates peaked? The narrative on this is evolving even as I write this. From interest rates having topped out a week ago, there now seems to be some shift of bets towards another rate hike with a no interest rate cut but higher for longer narrative. But sift through the commentary, and what emerges is that most don’t see interest rates heading much higher. For long-term investors, that’s as good a cue as possible. Locking into higher rates by investing a part of your total allocation over the next 6 to 9 months could be a good approach.

ALSO READ | Should investors chase yields?

The case of US bonds

There are two reasons for Indian investors to consider investing in overseas bonds. First, is the attractive returns they offer. The second, is the relative safety (academically in the short-term). Let’s look at this. On a plain reading, US bond yields on a 10-year security at near 4.7% would look unattractive vis-à-vis the near 7.3% on Indian Government securities of a similar tenure. However, for a fair comparison, the dollar-rupee factor must be brought into the equation. Over the past 20 years, the rupee has depreciated at a compounded 3% per year against the US dollar. If you add that to the US bond yield, the ultimate return climbs to 7.7%.

Source: investing.com

What’s more, just like with any other debt instrument, investors should take note of the rating quality of the debt they are investing in. Here too, the US scores among the highest ratings in the world, despite recent concerns. Moody’s still retains an Aaa rating for the US, but ascribes a Baa3 rating to Indian sovereign debt. A look at the ratings snapshot below offers a perspective.

Source: Tradingeconomics

Here, it pays to mention that in the near term, barring any unforeseen, radical developments, for all practical purposes, US Government and Indian Government debt can be considered equally safe with respect to payment of interest and return of principal. Hence, a significantly lower rating alone should not prompt you to shift allocation from local bonds to overseas bonds.

ALSO READ | Rupee hits a new low as RBI ends jinx of 83.30; Refinitiv gets a rap

Good time to bond

For investors, the important point is that this could be a good time to invest in debt. But look for safe options rather than get drawn by mouth-watering yields, as high yields only come with higher risk. While the more informed could consider corporate debt as an option, for most investors, government securities are a better direct investment option. Investors can also look at gilt funds and debt funds with a healthy performance track record.

Happy investing!

Read more from CNBC-TV18’s Sonal Sachdev

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

SBI raises ₹10,000 crore via tier 2 bonds at 7.8% coupon rate

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

State Bank of India (SBI), country’s largest lender, on Wednesday, November 1, raised ₹10,000 crore at a coupon rate of 7.81% through its first Basel III compliant Tier 2 Bond for the current financial year. The bonds are issued for a tenor of 15 years, with the first call option after 10 years.

The issue attracted an overwhelming response from the investors with bids of ₹15,907 crore and was oversubscribed almost 4 times against the base issue size of ₹4,000 crore with 98 bids, SBI said.

Dinesh Khara, Chairman SBI expressed that “wider participation and heterogeneity of bids demonstrated the trust investors place in the country’s largest Bank.”

This is the first Tier 2 bond issuance by the bank in the current financial year. The bank has been rated AAA with stable outlook from CRISIL and India Ratings & Research Private Limited for these instruments.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Now you can invest in Floating Rate Savings Bonds via RBI’s retail direct portal

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

In a move aimed at broadening investment opportunities for individual investors, the Reserve Bank of India (RBI) has expanded the range of products available through its Retail Direct Portal. The latest addition to the basket of investment options is Floating Rate Savings Bonds (FRBs), 2020 (taxable).

Until recently, these bonds were exclusively accessible at select branches of the State Bank of India, nationalised banks, private sector banks authorised by the RBI, and other entities designated by the Reserve Bank of India, following the government’s guidelines on floating rate bonds released in June 2020.

According to an RBI circular dated October 23, 2023, retail investors can now access a more diverse spectrum of investment instruments through the Retail Direct Portal. This development comes after the Reserve Bank of India, in collaboration with the Government of India, permitted subscription to Floating Rate Savings Bonds, 2020 (Taxable) – also known as FRSB 2020 (T).

Previously, the Retail Direct Portal allowed retail investors to invest in central government securities, treasury bills, state government securities, and sovereign gold bonds.

Investors can now subscribe to these bonds using various methods, including cash (up to ₹20,000 only), drafts, cheques, or electronic modes.

Understanding Floating Rate Savings Bonds

FRSBs are interest-bearing bonds issued by the central government. They are non-tradeable and mature after seven years from the date of issue.

What sets them apart from traditional bonds is their variable coupon rate, which is reset at predetermined intervals. In essence, the interest rate on these bonds fluctuates throughout their tenure.

In its July review, the RBI increased the interest rate on its floating rate savings bonds (2020) from 7.35% to 8.05%, valid until June 30, 2023. Notably, the interest rate on RBI savings bonds carries a 0.35% premium over the National Savings Certificate (NSC) interest rate. Any adjustments in the NSC interest rate are mirrored in the interest rate offered on RBI savings bonds.

Taxation of RBI FRSBs

Interest earnings from RBI FRSBs are classified as taxable income and are subject to taxes in accordance with the Income Tax Act of 1961, based on the applicable income tax slab for the investor.

Moreover, these bonds are eligible for Tax Deducted at Source (TDS) when interest payments are made. If investors are eligible for any exemptions, they must declare them in the application form.

Notably, RBI FRSBs are exempt from wealth tax under the Wealth Tax Act of 1957, although there are no deductions available on the principal investment.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow