For investors seeking a couple of benefits, including capital protection, capital appreciation, tax benefits from a single investment, here is a list of 3 investment options providing a mix of such benefits
1. SREI Infrastructure Finance Limited NCD IPO
The public issue of the Kolkata-based company is now open for subscription by the general public and institutional investors until September 17, 2013. With an attractive interest rate of 11.75% and 11.50% on a 5 year and 3 year subscription respectively, the secured redeemable non-convertible debenture offers a higher rate of return in comparison to bank fixed deposits. Also, the secured NCDs by SREI provide an option to subscribers under the cumulative scheme to double their corpus in a span of 6 years and 3 months.
The company with an issue size of Rs. 200 crores would allot the units on First Come First Serve Basis subject to minimum subscription size of 10 units. So, the particular IPO on offer can be subscribed taking into consideration higher rate of return as well as tax benefits as such NCDs when maintained in demat form irrespective of the investment amount do not attract tax deduction at source (TDS) on interest earned like bank fixed deposits.
Safety in the financial instrument is backed by CARE AA- rating of CARE and BWR AA rating of Brickwork India.
2. HDFC Capital Protection Oriented Fund - Series 1
The 3-year close ended scheme by HDFC mutual fund is a new fund offer primarily targeted at risk-averse investors interested in equity exposure to some degree. The scheme open for subscription until August 30, 2013would serve to protect the capital of investors by investing in money market and debt instruments to the extent of 83-88% of total funds. With the provision for capital appreciation for its investor class, the scheme would invest approximately 17% of the corpus in high-risk equity or equity related securities, including equity derivatives.
The investors interested in the NFO by HDFC fund can apply for the offer with the minimum sum of Rs. 5000 and thereafter in multiples of 10. The scheme available in Direct and Regular option comes with a no entry and exit load. The performance of the NFO scheme by HDFC MF would be judged against the benchmark CRISIL MIP Blended Index.
3. IDBI Tax Saving Fund - NFO
The open-ended scheme by IDBI mutual fund is an equity-linked savings scheme (ELSS) open for subscription until September 3, 2013. The scheme is ideal for investors seeking a mix of capital appreciation and tax benefits from an investment. Investment of up to Rs. 1Lac in the scheme would provide tax benefits under section 80C. Any dividend declared on the ELSS scheme is also exempt from tax.
The scheme by investing 80% of the total collected corpus in equity and equity related securities would also provide capital appreciation to its investors. Withdrawal of the fund does not attract Long Term Capital Gains Tax.
The units of the fund would be offered at par at a face value of Rs. 10 during the subscription period and after that at NAV-related prices.
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