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NON CONVERTIBLE DEBENTURES
(NCD)
What are Debentures?
• Debenture is a debt instrument which is used by companies to borrow
money from general public.
• Mo...
Debentures
• Debenture holders are creditors
of the company
• Debenture holders get interest
irrespective of profit or los...
Types of Debentures
Convertible Debentures
These debentures are
unsecured bonds that can be
converted to company equity
sh...
Advantages
• Higher Liquidity
• Fixed Interest
• Better Safety*
• No Tax Deducted at source (TDS)
• Rated by credit rating...
Points to remember
1. Face value : Value printed on the instrument
2. Coupon Rate: Rate of interest
3. Redemption : Repaym...
looking for
higher
security

looking for
regular
interests

aiming to
diversify
portfolio

Suitable
for
Investor
looking f...
Make sure you have..
PAN : As per SEBI guidelines, it’s essential to have a permanent
account number to invest in debentur...
Intermediary
Services

Getting Started
•
•
•
•

• Voice
• Online through
www.investmentz.co
m
• NSE / BSE Cash
• IPOs / Bo...
Thank You
Upcoming SlideShare
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Non Convertible Debentures

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Debenture is a debt instrument which is used by companies to borrow money from general public. Here's a presentation that tells you everything you need to know about Non Convertible Debentures

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Non Convertible Debentures

  1. 1. NON CONVERTIBLE DEBENTURES (NCD)
  2. 2. What are Debentures? • Debenture is a debt instrument which is used by companies to borrow money from general public. • Most debentures pay a FIXED rate of interest/ Coupon
  3. 3. Debentures • Debenture holders are creditors of the company • Debenture holders get interest irrespective of profit or loss • Convertible debentures can be converted into equity shares • Debentures will get priority is getting the money back as compared to shareholder in case of liquidation of a company V/S Shares • Shareholders are the owners of the company • Shareholder get a portion of the profits called dividend subject to director’s declaration • Shares cannot be converted into debentures • In case of liquidation of company, equity shareholders get their money back after settling all statutory expenses and creditors.
  4. 4. Types of Debentures Convertible Debentures These debentures are unsecured bonds that can be converted to company equity shares. Secured NCD Secured NCDs are backed by assets hence the default risk is negligible Non Convertible Debentures NCDs are those instruments which can't be converted into company's equity shares. Unsecured NCD Unsecured NCDs are not backed by assets. Hence they entail a higher risk factor.
  5. 5. Advantages • Higher Liquidity • Fixed Interest • Better Safety* • No Tax Deducted at source (TDS) • Rated by credit rating agencies • NCDs are traded on Stock Exchanges • Available in Demat format • Interest get paid ECS / RTGS / NEFT/ Direct Credit mode
  6. 6. Points to remember 1. Face value : Value printed on the instrument 2. Coupon Rate: Rate of interest 3. Redemption : Repayment of instrument 4. Market Price : Value at which instrument is traded 5. Rating : Credit rating agencies rating. 6. Tenure : Validity of debenture in years 7. Yield : Annual returns of investment Instrument per year in percentage
  7. 7. looking for higher security looking for regular interests aiming to diversify portfolio Suitable for Investor looking for better liquidity having low risk appetite
  8. 8. Make sure you have.. PAN : As per SEBI guidelines, it’s essential to have a permanent account number to invest in debentures. Demat A/C : NCDs are compulsorily issued in a dematerialized format, hence you should have a Demat A/C
  9. 9. Intermediary Services Getting Started • • • • • Voice • Online through www.investmentz.co m • NSE / BSE Cash • IPOs / Bonds / NCD's • Mutual Funds PIS approval Bank A/c opening Demat A/c opening Trading A/c opening Services of ACMIIL Research Compliance / Back Office
  10. 10. Thank You

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