What this is
NCDs are debt instruments issued by companies to raise capital, paying a fixed coupon (typically 8-12% p.a.) over a defined tenure. Yields beat bank fixed deposits, with the trade-off being credit risk based on the issuer. We help you pick listed, credit-rated NCDs that match your income and risk needs — and stay clear of the rest.
- Secured NCDs (backed by company assets) and unsecured NCDs
- Coupon options: monthly, quarterly, annual, cumulative
- Tenures from 1 to 10 years across issuers
- Listed NCDs — exchange liquidity if you need to exit before maturity
- Credit-rating filtered shortlist — we don't push unrated or low-rated paper
FAQ
- How are NCDs different from bank FDs?
- FDs are issued by banks and carry implicit RBI oversight + ₹5 lakh DICGC insurance. NCDs are issued by companies — usually offer 1-3% higher yields but carry the issuer's credit risk. A AAA-rated NCD from a top NBFC is very different from an unrated small-issuer NCD.
- What credit ratings should I look for?
- We typically stay in AAA / AA+ rated paper for conservative portfolios; AA / AA- can earn extra yield for risk-tolerant investors. Below A, only with strong issuer-specific reasoning.
- How are NCDs taxed?
- Interest income is taxed at your slab rate. Capital gains on sale before maturity are taxed as STCG (slab rate, <1 year) or LTCG (10% without indexation, ≥1 year for listed NCDs).
- Can I exit before maturity?
- Listed NCDs trade on BSE/NSE — you can sell anytime, though spreads can be wide for less-liquid issues. Unlisted NCDs are typically hold-to-maturity.