NHPC tax-free bonds sold out a day before closing

MUMBAI: The tax-free bonds of state-run NHPC were sold out a day before the official end of the sale period as investors, starved of decent fixed income returns for three years, piled on to benefit from the highest tax-free returns in more than three years.

The company had received bids for Rs 1,950 crore, nearly double the Rs 1,000 crore it planned to raise. NHPC bonds carry a coupon of 8.43% for 10 years, 8.79% for 15 years and 8.92% for 20 years for retail investors.

Even though the rates for companies and wealthy individuals were a tad lower, it was sold out on the day of opening of issue on October 18.

The coupon for them is at 8.18%, 8.54% and 8.67% for similar maturities.