0
Debentures
In law, debenture refers to a document which creates or acknowledges a debt. In corporate finance, it refers to an instrument used by companies to loan money. Debentures are generally transferable.
299 Questions
What working hours you prefer, day, swing or night shift.
Which are the companies that have issued debent ures in recent years?
company who have issued recently deventures
When to create a Debenture Redemption Reserve?
Most companies retire debentures by issuing another set of debentures, hence, most companies don't park funds for retiring debentures by creating any fund. The bond market will surely get affected negatively by such a move of the ministry of corporate affairs.
Section 117C of the Companies Act, 1956, requires every company issuing debentures to create a debenture redemption reserve (DRR) for the redemption of such debentures and transfer an 'adequate' amount from its profits every year to such DRR until the issued debentures are redeemed. Hence, every issue of redeemable debentures requires creation of a DRR. The said Section, however, does not provide the meaning of the word 'adequate'. In the year 2002, the ministry of corporate affairs (MCA) issued a circular clarifying the meaning of 'adequate' and provided the percentage which is mandatorily required to be transferred to DRR by certain class of companies. However, to develop the bonds market, MCA issued another clarification circular on 11 February 2013 (Circular 2013)
What are the uses of share premium?
Share premium is used for many purposes and 1 of them is redemption of preference shares and debentures
Is debenture of icore-e-services ltd fully secured?
Yes, the debenture of Icore-e-services ltd is fully secured....subhendu, Alipurduar
What is the secured redeemable non-convertible debenture?
history of secured redeemable non convertible debentures
Is alchemist redeemable preference share safe?
100% you should try to invest in redeemable preference share. because client get bond on investment. no need to wait for long time.
Alchemist Redeemable Preference Share visit here for 100% guaranteed investment
What is market value of a debenture today?
The market value of a debenture today is determined by its current trading price in the financial markets, which reflects factors such as prevailing interest rates, the creditworthiness of the issuer, and the time remaining until maturity. If market interest rates rise, the value of existing debentures typically falls, and vice versa. Additionally, the market value can be influenced by supply and demand dynamics among investors. To find the exact market value, one would typically look at recent trading data or financial market quotes.
A noncallable bond is a debenture which the company or institution that issued it cannot force you to redeem before the final call date (i.e. they can't call it). For example, if you purchased a 30-year bond in 2005 with a 4.5% coupon, the issuer today would like to call that bond because they can borrow money more cheaply (i.e. at a lower interest rate). But if the bond is noncallable they cannot do that. The trade-off is that a noncallable bond generally has a slightly lower nominal coupon.
Companies issued debentures in recent year?
1) Muthoot Finances announced the issue of Non-convertible Debentures for Rs 150 cr.
2) Reliance capital issued Rs 500 cr Non-convertible debentures.
3) Shriram Transport Finances announced the launch of its second secured redeemable non-convertible debentures issue to raise Rs 500 cr.
4) Tata Global Beverages said it raised Rs 325 cr in private placement of debentures.
What Advantages does issue of debentures over equity shares?
Cost is the major advantage. Debentures are to be serviced for the contracted period of time, while equity servicing is perennial.
Who is a preference share holder?
There are 2 types of shareholders
1.Equity
2. Preference
preference shareholders have preference in the payment of dividend over equity shareholders. Usually their % of dividend is fixed at the time of issue.
For further details check out this link
http://www.legalserviceindia.com/company%20law/com_2.htm
anyoption™ is a binary option trading platform available for private and institutional investors worldwide. Our option trading platform is 100% web based, and does not require software download or any other previous trading experience. anyoption™ pricing and execution modules set up a new standard in the online trading market: the interface is self explanatory and easy to use, the range of products we offer options on is incomparable and the speed and accuracy of settlements is flawless. We use the most advanced and stable technologies to assure your safety and satisfaction.
Binary options - also known as digital options or fixed return options - are becoming more and more popular in recent years and are in considerable demand especially in times of markets uncertainty. The advantages are clear - return is known in advance, no liquidity or execution issues, wide range of expiry points and a unique feature of anyoption™: 15% of the principal investment is paid back even if your option
Difference between preference share and equity share?
1)Preference Shares have 2 preferences first payment of dividend in every year in which dividend is proposed & first share capital of preference shares will be payab;e @ winding up or liquidation of the company,where as equity share holders dividend after preference share holders & even share capital capital is also paid after paying to preference share holders.
2)preference share holders are not owners of the company and do not enjoy any voting right. Where as Equity Shares has voting right & they are the real owners of company.
3)Preference Shares have a finite tenure and carry a fixed rate of dividend where as dividend to equity shares is payable rest of the dividend payable after preference share holders.
Right debentures are a type of debt instrument issued by a company that allows existing shareholders to purchase additional debentures at a predetermined price, typically during a rights issue. This gives shareholders the opportunity to maintain their proportional ownership in the company while providing the company with capital for financing. Right debentures often come with specific terms regarding interest rates and maturity, and they may be convertible into equity under certain conditions.
Types of debentures in company law?
What is a Debenture?
A Debenture is a debt security issued by a company (called the Issuer), which offers to pay interest in lieu of the money borrowed for a certain period. In essence it represents a loan taken by the issuer who pays an agreed rate of interest during the lifetime of the instrument and repays the principal normally, unless otherwise agreed, on maturity.
These are long-term debt instruments issued by private sector companies. These are issued in denominations as low as Rs 1000 and have maturities ranging between one and ten years. Long maturity debentures are rarely issued, as investors are not comfortable with such maturities
Debentures enable investors to reap the dual benefits of adequate security and good returns. Unlike other fixed income instruments such as Fixed Deposits, Bank Deposits they can be transferred from one party to another by using transfer from. Debentures are normally issued in physical form. However, corporates/PSUs have started issuing debentures in Demat form. Generally, debentures are less liquid as compared to PSU bonds and their liquidity is inversely proportional to the residual maturity. Debentures can be secured or unsecured.
What are the different types of debentures?
Debentures are divided into different categories on the basis of: (1)convertibility of the instrument (2) Security
Debentures can be classified on the basis of convertibility into:
· Non Convertible Debentures (NCD): These instruments retain the debt character and can not be converted in to equity shares
· Partly Convertible Debentures (PCD): A part of these instruments are converted into Equity shares in the future at notice of the issuer. The issuer decides the ratio for conversion. This is normally decided at the time of subscription.
· Fully convertible Debentures (FCD): These are fully convertible into Equity shares at the issuer's notice. The ratio of conversion is decided by the issuer. Upon conversion the investors enjoy the same status as ordinary shareholders of the company.
· Optionally Convertible Debentures (OCD): The investor has the option to either convert these debentures into shares at price decided by the issuer/agreed upon at the time of issue.
On basis of Security, debentures are classified into:
· Secured Debentures: These instruments are secured by a charge on the fixed assets of the issuer company. So if the issuer fails on payment of either the principal or interest amount, his assets can be sold to repay the liability to the investors
· Unsecured Debentures: These instrument are unsecured in the sense that if the issuer defaults on payment of the interest or principal amount, the investor has to be along with other unsecured creditors of the company.
What is the advantages and disadvantages of debentures?
-
You get a fixed preannounced return on your investment.
-
You do not gain from the performance of the company.
-
You may be affected by the inability of the company to honor its commitment to you by way of payment.
-
You have a priority claim over the shareholders in case of a company going bankrupt. Country specific laws apply.
-
Some debentures are converted into equity shares after a specific period
Note: Please read the terms and conditions carefully.
How do you make the debenture more popular?
the companies that have issued debentures in recent years.give suggestions to make debentures more popular?
What is Three basic reasons is profit maximization inconsistent with wealth maximization?
Profit maximization is a narrow view which accounts for only the difference between sales and costs
Wealth Maximization is broader and more philosophical in approach.
Wealth maximisation includes not exhaustively culture , synergy, value, potential and wealth
What are registered debentures?
Certain debentures are made out in the names of the particular persons whose names appear in the register of debenture holders. Such debentures which appear in this register are known as "Registered Debentures".
They are transferable in the same way as shares. Interest as well as the debenture amount in these cases is payable only to the registered holders.
