Prime Bonds

Primary issuances of G-Secs/SDLs

These are our past and current recommendations of primary auctions of Government securities (G-Secs), State Development Loans (SDLs) and treasury bills. We issue these recommendations based on the coupon rate the bonds carry, its tenure and the issue size (as it determines liquidity). For SDLs, we additionally consider the fiscal health of the issuing State. We look at the stage of the interest rate cycle as well. These bonds pay interest half yearly and there is no cumulative option.

The objective of these recommendations is to help you lock into good yields in instruments that come with a sovereign guarantee and to ensure a steady source of income. These primary issuances are open for very short periods. We send email alerts when these issues open, which typically occur over weekends. So, ensure that you keep tab of our emails.

Suitability: These bonds are a low-risk guaranteed option, best suited for those looking to set up a steady income. If you do not need an income stream, and you invest in these bonds, reinvest the interest received to ensure wealth building. For those keen on earning high yields by taking higher risk, check the next section - High Risk: Privately placed bonds and secondary issuances.

Current recommendationsCurrent recommendations

IMPORTANT POINTS TO NOTE:

1. These calls are not meant to time secondary market purchase of bonds. We may choose to give those calls separately.
2. Interest on these bonds is fully taxable. However, these bonds do not have TDS.
3. We encourage you to open an RBI Retail Direct account to buy these bonds. Some bonds will be available with brokerages who make such auctions accessible. But our observation is that not all issuances that are on the RBI Retail Direct platform are available on these brokerages.
4. RBI Retail Direct has a secondary market trading provision to sell these bonds. However, our calls are meant as ‘buy and hold’ these bonds to generate steady income.
5. Read more on how to choose bonds in RBI Retail Direct here.

Low to moderate risk bonds

These are our past and current recommendations of low to moderate risk bonds/NCDs listed in the exchanges. The objective of these recommendations is to provide returns superior to large bank deposits and slightly higher yield than typically high-rated bonds. These are meant to diversify your debt exposure. We do not provide high yielding bonds in this segment. For those keen on earning high yields by taking higher risk, check the next section – High Risk bonds.

These bonds/NCDs are typically listed in the exchanges (please check the table below for details) and may be issued by financial or non-financial companies. Even if they are listed, there is no guarantee that they will have liquidity. You may not be able to sell them in the market when needed. Our call is usually a hold-till maturity unless otherwise mentioned in the report. Please read the report and assess whether the bond suits your risk profile before investing.

We look at low-risk bonds/NCDs with high credit rating, sound financials and ability to service debt. In the case of financial companies, sound balance sheet and clear end use of money lent are also criteria used for filtering. If the bond yield is superior to bank deposits or similar tenure highly rated bonds, we consider them. We stick to the listed bonds in this category.

Suitability: These bonds are best suited for those who can take low to moderate risk and looking to set up a steady income. Most of these bonds have only interest payout options and some may have cumulative option. If you do not need an income stream, and you invest in these bonds, reinvest the interest received to ensure wealth building.

Current recommendations

IMPORTANT POINTS TO NOTE:

1. These bond calls are meant to be held till maturity unless we state otherwise. Many of them may not be traded or can be highly illiquid, even if the dealer offers to sell them for you.
2. Listed and unlisted bonds will suffer TDS of 10% and you can claim the same as credit. You can check for this under Form 26AS.
3. The interest on these bonds is fully taxable at your slab rate.

Disclaimers

1. PrimeInvestor does not have any commercial agreement with any of the bond platforms or bond issuers or vendors. 
2. PrimeInvestor does not receive, directly or indirectly, any commission or any other reimbursement in any form – from any of the parties involved in the issuance. We are not brokers nor distributors. 
3. PrimeInvestor is not involved in the onboarding process nor in the execution of these transactions and as such is not liable for any acts of commission or omission. We will be unable to respond to any kind of operational queries regarding these transactions. 
4. Our responsibility is limited to recommending these products based on information available to the best of our knowledge. Despite best effort on due diligence, there is a risk of default in these instruments. 
5. PrimeInvestor is a SEBI registered Research Analyst (Registration: INH200008653). The content and reports generated by the entity does not constitute or is not intended to constitute an offer to buy or sell, or a solicitation of an offer to buy or sell financial products, units or securities. All content and information are provided on an ‘as is’ basis by PrimeInvestor Financial Research Pvt Ltd. Information herein is believed to be reliable but PrimeInvestor Financial Research Pvt Ltd does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. The services rendered by PrimeInvestor Financial Research Pvt Ltd are on a best-effort basis. PrimeInvestor Financial Research Pvt Ltd does not assure or guarantee the user any minimum or fixed returns. PrimeInvestor Financial Research Pvt Ltd or any of its officers, directors, partners, employees, agents, subsidiaries, affiliates or business associates will not liable for any losses or cost of damage incurred consequent upon relying on investment information, research opinions or advice or any other material/information whatsoever on the web site, reports, emails or notifications issued by PrimeInvestor Financial Research Pvt Ltd or any other agency appointed/authorised by PrimeInvestor Financial Research Pvt Ltd.
6. Use of the above-said information is at the user’s own risk. The user must make his/her own investment decisions based on his/her specific investment objective and financial position and using such independent advisors as he/she believes necessary. This report is a review of a financial product and should not be construed as advice. Investors would need to take an informed decision about taking on such risk. Such risk is entirely that of the investor. PrimeInvestor absolves itself of any risk of non-payment of interest or principal from the instruments it recommends.

Privately placed bonds and secondary bond issuances

These are our past and current recommendations of privately placed bonds and other secondary issuances. The objective of these recommendations is to provide high yield, high risk options to diversify your debt portfolio. These issuances or sale are meant only for those expressly looking for better-returning, riskier options, and who have a large corpus.

Sale of privately placed bonds may be available for very short periods. We send email alerts when we issue such recommendations. So, ensure that you keep tab of our emails. If we issue a call on a bond listed in a bond platform, you will need to do your due diligence before you open an account with such a platform.

 Suitability: These bonds are meant only for investors who can take risk in debt instruments. These bonds can form part of the high-risk component of your debt portfolio, with risk of loss to capital. These bonds should not be a large part of your portfolio. You will need to have a large corpus to invest in these bonds as the average minimum investment size is typically between Rs 2 lakh-Rs 10 lakh. You can use these bonds to generate an additional source of income as they usually carry only interest payout option; else, reinvest in other options, preferably lower-risk.

Invest in these bonds only after exhausting low risk instruments such as deposits or G-Secs, or quality debt funds. Check the accompanying section Low Risk: Primary issuances of G-Secs/SDLs, Prime Deposits and Prime Funds for our recommendations.

Current recommendations

IMPORTANT POINTS TO NOTE:

1. Read this article that explains everything about Private Placement bonds before you venture to buy these bonds.
2. We do not have any commercial agreement and do not receive any fee or commission from manufacturers or brokers of these bonds. We only research and analyse the bonds to present our views.
3. These bond calls are meant to be held till maturity unless we state otherwise. Many of them may not be traded or can be highly illiquid, even if the dealer offers to sell them for you.
4. Unlisted bonds will suffer TDS of 10% and you can claim the same as credit. You can check for this under Form 26AS.
5. The interest on these bonds is fully taxable at your slab rate.

Disclaimers

1. PrimeInvestor does not have any commercial agreement with any of the bond platforms or bond issuers or vendors. 
2. PrimeInvestor does not receive, directly or indirectly, any commission or any other reimbursement in any form – from any of the parties involved in the issuance. We are not brokers nor distributors. 
3. PrimeInvestor is not involved in the onboarding process nor in the execution of these transactions and as such is not liable for any acts of commission or omission. We will be unable to respond to any kind of operational queries regarding these transactions. 
4. Our responsibility is limited to recommending these products based on information available to the best of our knowledge. Despite best effort on due diligence, there is a risk of default in these instruments. 
5. PrimeInvestor is a SEBI registered Research Analyst (Registration: INH200008653). The content and reports generated by the entity does not constitute or is not intended to constitute an offer to buy or sell, or a solicitation of an offer to buy or sell financial products, units or securities. All content and information are provided on an ‘as is’ basis by PrimeInvestor Financial Research Pvt Ltd. Information herein is believed to be reliable but PrimeInvestor Financial Research Pvt Ltd does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. The services rendered by PrimeInvestor Financial Research Pvt Ltd are on a best-effort basis. PrimeInvestor Financial Research Pvt Ltd does not assure or guarantee the user any minimum or fixed returns. PrimeInvestor Financial Research Pvt Ltd or any of its officers, directors, partners, employees, agents, subsidiaries, affiliates or business associates will not liable for any losses or cost of damage incurred consequent upon relying on investment information, research opinions or advice or any other material/information whatsoever on the web site, reports, emails or notifications issued by PrimeInvestor Financial Research Pvt Ltd or any other agency appointed/authorised by PrimeInvestor Financial Research Pvt Ltd.
6. Use of the above-said information is at the user’s own risk. The user must make his/her own investment decisions based on his/her specific investment objective and financial position and using such independent advisors as he/she believes necessary. This report is a review of a financial product and should not be construed as advice. Investors would need to take an informed decision about taking on such risk. Such risk is entirely that of the investor. PrimeInvestor absolves itself of any risk of non-payment of interest or principal from the instruments it recommends.