Tuesday, July 25, 2023

This will make you reconsider FD investing - prepare for this - Fixed deposit investor know this

At least part of FD meant investments may go into bonds- Now investors may see frequent and regular bond/debt issuances to subscribe to (weekly, monthly or even quarterly).

Why ?

A- One time clearance at company level for or within a fixed period. For example if L & T intends to raise 1200 cr for say FY 23-24 they may apply and get approval for the whole year and may divide the issuances over the year. This is win-win-win model. Amazing initiative by #sebi

B- This helps the company to plan their cash flows rather than getting the money say at start of the year and then deploying some at fag end of the year, but bearing the cost without deploying. Rather companies can actually plan issuances as per required cashflow, but take one time approval keeping the basis the same. (may be int.rates, term and amount of issue only differs- lets see)

C- Plus, if ASBA is applied for the same, the cash to the issuer is literally available in 5-6 days to deploy.

At times, I write well in advance what is coming in simple language.

#financialplanning #financialplanner #mutualfund #investing #investingforbeginners #couplechallengeaccepted #cfp #wealthcreation #investing #couplegoals

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