Edelweiss Financial Services will begin issuing NCDs with subscriptions starting January 9, 2024. Edelweiss Financial Services is a leading investment banking firm with diversified businesses including retail, corporate credit, and asset management. NCD interest rate is up to 10.45%. . These NCDs are offered in terms of 24 months, 36 months, 60 months, and 120 months. The interest on these NCDs is paid either monthly, annually or on maturity, depending on the option selected by the investor. Should you invest in the January 2024 issue of Edelweiss Financial Services NCD? What are the risk factors to consider before investing in such high-risk NCDs?
Also read: 10 Best SIP Mutual Funds of 2024
About Edelweiss Financial Services Limited
The investment banking company has diversified its businesses to include credit, including personal and corporate credit, wealth management, asset management, asset rehabilitation, and insurance, including life insurance and non-life insurance operations conducted through its subsidiaries, through its subsidiaries.
Edelweiss Financial Services NCD – January 2024 – Issue Details
Details of the NCD issue are as follows:
| Subscription start date | January 9, 24 |
| Subscription end date | January 22, 24 |
| Issued securities name | Edelweiss Financial Services Limited |
| Type of security | Secured, redeemable, non-convertible debt |
| Publication size (base) | 125 million rupees |
| Publish size (option to keep beyond subscription) | 125 million rupees |
| Total issue size | 250 million rupees |
| Issue price | 1,000 rupees per deposit |
| face value | 1,000 rupees per deposit |
| series | from me to x |
| minimum lot size | 10 bonds and then 1 bond |
| tenure | 24, 36, 60, 120 months |
| Interest payment frequency | Monthly, annual, cumulative |
| Listed | Within 6 business days for BSE/NSE |
| lead manager | Trust Investment Advisors Private Limited and Nuvama Wealth Management Limited |
| bond trustee | BEACON TRUSTEESHIP LIMITED. |
interest rate of Edelweiss Financial Services NCD – January 2024
| series | I | II | Ⅲ | Ⅳ | V | VI | VII | VIII | IX | X |
|---|---|---|---|---|---|---|---|---|---|---|
| Interest payment frequency | yearly | N.A. | monthly | yearly | N.A. | monthly | yearly | N.A. | monthly | yearly |
| Period of employment (months) | twenty four | twenty four | 36 | 36 | 36 | 60 | 60 | 60 | 120 | 120 |
| Coupon (% per year) | 8.95% | N.A. | 9.20% | 9.60% | N.A. | 9.67% | 10.10% | N.A. | 10.00% | 10.45% |
| Effective yield (%/year) | 8.94% | 8.95% | 9.59% | 9.59% | 9.60% | 10.10% | 10.09% | 10.10% | 10.46% | 10.44% |
| Amount at maturity (Rs.) | 1,000.00 | 1,187.30 | 1,000.00 | 1,000.00 | 1,317.00 | 1,000.00 | 1,000.00 | 1,618.70 | 1,000.00 | 1,000.00 |
why invest Edelweiss Financial Services NCD – January 2024?
Let’s take a look at the positive factors in this NCD issue.
- This NCD offers attractive interest rates where investors can earn up to 10.45% interest per annum.
- Issue a secure NCD. A secured NCD is always safer compared to an unsecured NCD. If a company liquidates or goes out of business for any reason, NCD investors who have secured security can preferentially repay the capital backed by the company’s assets with interest.
- These NCDs are rated as CRISIL A+/Stable and ICRA A+/Rating Watch. NCD products with this rating are considered to have sufficient security with respect to timely repayment of financial obligations. The credit risk of such products is low.
Also read: Muthoot Finance NCD January 2024 offers 9% interest rate
why not invest Edelweiss Financial Services NCD – January 2024?
Let us review some of the negative or risk factors in this NCD issue.
Edelweiss Financial Services NCD – January 2024 – Should I invest?
- These NCDs offer high interest rates. Although banks have increased their FD interest rates recently, they are still low compared to the interest rates offered on these NCDs. These NCDs are rated CRISIL A+/Stable by CRISIL Ratings and ICRA A+/Ratings Watch by ICRA Ratings. Also, although secured NCD bonds are relatively safer than unsecured bonds, they are not 100% risk-free.
- However, these long-term ratings have recently been downgraded and may change in the future. Over the past five years, corporate revenues have been declining and profit margins have been shrinking, but they have started to recover from FY23. It must be remembered that in the past few years some NBFC companies have defaulted on NCD payments and some NBFC companies have delayed NCD repayments.
High-risk investors who understand all these risk factors can invest in these NCDs.
Suresh KP is the founder of Myinvestmentideas. He is a NISM Certified Investment Advisor and he is a NISM Certified Research Analyst. He has been analyzing financial markets for the past 20 years. He can be reached at suresh@myinvestmentideas.com.
