What are Corporate Bonds?

Average returns9.75%

Average Yield8.00%

Min. Investment₹10,00,000

What are Corporate Bonds?

Companies issue corporate bonds to raise finance for various reasons, such as building a new plant, buying equipment or for business expansion. Corporate bonds are generally medium to long-term debt instruments with more than one year of maturity. Whereas debt instruments issued by corporates with a maturity shorter than one year are referred to as commercial paper.

Best Corporate Bonds for your investment

Top Bonds		Coupon(%)	Rating	Yield(%)
360 ONE PR... INE248U07EV0	Price ₹ 1,000	Coupon 9.22%	Rating AA	Yield 29.51%	INVEST NOW
EDELWEISS ... INE015L07576	Price ₹ 1,000,000	Coupon 2%	Rating A+	Yield 20.36%	INVEST NOW
EDELWEISS ... INE015L07469	Price ₹ 1,000,000	Coupon 2%	Rating A+	Yield 20.36%	INVEST NOW
MUTHOOT FI... INE549K07CF9	Price ₹ 1,000	Coupon 8.4%	Rating AA-	Yield 17.14%	INVEST NOW
GOSWAMI IN... INE219O07362	Price ₹ 100,000	Coupon 0%	Rating BB	Yield 17.13%	INVEST NOW
SAMMAAN CA... INE148I08215	Price ₹ 100,000	Coupon 9.3%	Rating AA	Yield 16.02%	INVEST NOW
ECAP EQUIT... INE468N07623	Price ₹ 100,000	Coupon 0%	Rating A+	Yield 15.54%	INVEST NOW
TRUCAP FIN... INE615R07109	Price ₹ 100,000	Coupon 13%	Rating BB+	Yield 15.52%	INVEST NOW
TRUCAP FIN... INE615R07083	Price ₹ 100,000	Coupon 13%	Rating BB+	Yield 15.38%	INVEST NOW
SAMMAAN FI... INE244L08018	Price ₹ 100,000	Coupon 8.45%	Rating AA	Yield 15.35%	INVEST NOW
CSA INVEST... INE0LWH07054	Price ₹ 100,000	Coupon 14.25%	Rating B	Yield 15.22%	INVEST NOW
KINARA CAP... INE200W08124	Price ₹ 100,000	Coupon 13.4%	Rating BBB	Yield 15.2%	INVEST NOW
AKARA CAPI... INE08XP07308	Price ₹ 10,000	Coupon 9.85%	Rating BBB	Yield 15.2%	INVEST NOW
DVARA KSHE... INE179P08066	Price ₹ 100,000	Coupon 14.3%	Rating BBB+	Yield 15%	INVEST NOW
TRUCAP FIN... INE615R07125	Price ₹ 100,000	Coupon 13%	Rating BB+	Yield 14.92%	INVEST NOW

Best Corporate Bonds for your investment

Rating
All

Coupon(%)
All

Yield(%)
All

360 ONE PRIME LIMITE...
INE248U07EV0

Price
₹ 1,000

Coupon
9.22%

Yield
29.51%

Rating
AA

INVEST NOW

EDELWEISS ASSET RECO...
INE015L07576

Price
₹ 1,000,000

Coupon
2%

Yield
20.36%

Rating
A+

INVEST NOW

EDELWEISS ASSET RECO...
INE015L07469

Price
₹ 1,000,000

Coupon
2%

Yield
20.36%

Rating
A+

INVEST NOW

MUTHOOT FINCORP LIMI...
INE549K07CF9

Price
₹ 1,000

Coupon
8.4%

Yield
17.14%

Rating
AA-

INVEST NOW

GOSWAMI INFRATECH PR...
INE219O07362

Price
₹ 100,000

Coupon
0%

Yield
17.13%

Rating
BB

INVEST NOW

SAMMAAN CAPITAL LIMI...
INE148I08215

Price
₹ 100,000

Coupon
9.3%

Yield
16.02%

Rating
AA

INVEST NOW

ECAP EQUITIES LIMITE...
INE468N07623

Price
₹ 100,000

Coupon
0%

Yield
15.54%

Rating
A+

INVEST NOW

TRUCAP FINANCE LIMIT...
INE615R07109

Price
₹ 100,000

Coupon
13%

Yield
15.52%

Rating
BB+

INVEST NOW

TRUCAP FINANCE LIMIT...
INE615R07083

Price
₹ 100,000

Coupon
13%

Yield
15.38%

Rating
BB+

INVEST NOW

SAMMAAN FINSERVE LIM...
INE244L08018

Price
₹ 100,000

Coupon
8.45%

Yield
15.35%

Rating
AA

INVEST NOW

CSA INVESTMENTS PRIV...
INE0LWH07054

Price
₹ 100,000

Coupon
14.25%

Yield
15.22%

Rating
B

INVEST NOW

KINARA CAPITAL PRIVA...
INE200W08124

Price
₹ 100,000

Coupon
13.4%

Yield
15.2%

Rating
BBB

INVEST NOW

AKARA CAPITAL ADVISO...
INE08XP07308

Price
₹ 10,000

Coupon
9.85%

Yield
15.2%

Rating
BBB

INVEST NOW

DVARA KSHETRIYA GRAM...
INE179P08066

Price
₹ 100,000

Coupon
14.3%

Yield
15%

Rating
BBB+

INVEST NOW

TRUCAP FINANCE LIMIT...
INE615R07125

Price
₹ 100,000

Coupon
13%

Yield
14.92%

Rating
BB+

INVEST NOW

Types of Corporate Bonds

Mortgage Bonds

Different types of assets can be used as collateral to secure bonds. For example, mortgage-backed securities are bonds that are supported by mortgages. With a mortgage bond, bondholders have the option to sell the mortgaged properties to meet any outstanding obligations to bondholders.

Collateral Trust Bonds

Collateral trust bonds and mortgage bonds share similarities, except that collateral trust bonds do not use residential properties as collateral. Businesses employ collateral trust bonds when they lack permanent assets or real estate and instead hold securities from other firms. When issuing bonds, these firms pledge the stocks, bonds, and other interests they own in other companies.

Debenture Bonds

Debenture bonds, including treasury bills in the Corporate Bonds category, are unsecured bonds that lack specific property or asset backing. Companies often issue debenture bonds with favorable credit ratings, resulting in relatively moderate interest rates.

Guaranteed Bonds

Guaranteed bonds, as the name implies, are bonds that come with a guarantee. Another company provides the guarantee, reducing the risk of default as that company has committed to fulfilling the bond's obligations if required.

Valuation of Indian Corporate Bonds

Corporate Bonds are inversely proportional to interest rates as they rise in value with the fall in interest rates, and their value falls with the rise in interest rates. Normally, the longer the maturity, the greater is the percentage of price volatility. Corporate bond fund has its own importance. Investors can take the decision considering essential risk factors.

Upon holding the bond till maturity, the concern for the price fluctuations will be less which is known as market risk or interest-rate risk, because one will get the bond at face, or par value at the maturity. The inverse relationship of the bonds and interest rates means that the bonds are less worthy. When interest rates rise and vice versa that can be described below:

Rise in interest rates

New market issues come up with higher yields as compared to the older securities, making the older ones unworthy. Therefore, the prices will go down.

Decline in interest rates

New bond issues come up in the market with lower yields as compared to the older securities, which makes the older ones, higher-yielding ones, more useful. Hence, the prices will go up.

Selling of bond before maturity

If a person sells a bond before maturity, it makes worth if the prices are high presently or selling at lower rate is unworthy of what it was paid for.

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Features of Corporate Bonds in India

Taxable : Interest on corporate bonds is generally taxable.
Credit Rating Criterion : Corporate Bonds can be classified into two types on the basis of Credit Rating: Investment Grade and Non-investment Grade (Junk Bonds). Bonds having a credit rating of AAA to BBB are considered as Investment Grade Bonds; others are considered Non-investment Grade Bonds.
Coupon rate :  Corporate bonds have higher coupon rates than G-secs. Normally, corporate bonds provide 7% (AAA rated) to 12% (A-rated) coupons in the current year, 2021. On the contrary, G-secs provide a 6% coupon rate. Many times, investors prefer investing considering corporate bonds’ interest rates.
Tenor : Corporate Bonds have shorter tenures as compared to G-secs. Upon maturity of the corporate bond, the investor obtains the principal amount. Until maturity, the money is owed by the investor to the issuer, and during the maturity period, the principal is repaid with any outstanding interest, and the contract gets settled.
Moderate liquidity : The liquidity of the corporate bond market via Over counter is moderate to high, subject to the specific bond. Here, liquidity means the ease of selling the bonds without much price negotiation.

Why Invest in Corporate Bonds in India?

The better understanding of corporate bonds meaning and relevant information on the high yielding investment option can help fulfil your long-term objectives along with short term objectives. Corporate Bonds are a good and high yielding investment choice from a safe option. The income is predictable. Investors get interest twice and it is a reliable way to preserve your capital.

Advantages of Investing in Corporate Bonds

Good Investment Option

Every investor should gauze the risk involved in the investment option chosen for investment prior to making an investment. Corporate Bonds are a good investment option.

Higher Yields

For the investors looking for regular and higher returns corporate bonds are a good choice. In comparison to government bonds, the return in corporate bonds is high. The corporate bonds interest rates are also a major attraction for investors.

Low Risk

Corporate Bonds have a low risk and are not affected by inflation. Investing in corporate bonds with AA+ or above is safe. Also, in case the issuing company is declared bankrupt, bond holders get priority over stock holders.

Who Should Invest in Corporate Bonds?

Individual investors, corporations, and government enterprises can invest in corporate bonds. Interested investors can buy corporate bonds through a bank, a broker, brokerage firm, or a bond trader.

The retail investors interested in safe investment with capital preservation can consider investing in Corporate Bonds.

Why to Invest in Indian Corporate Bonds?

Corporate bonds are known to offer comparatively higher returns, liquidity, portfolio diversification, and are good for fixed periodic income. Investing in Indian Corporate Bonds can help you take the advantage of its excellent features and of course the returns better than other investment avenues.

Your preference for the investment in corporate bonds in India can also help you retire rich.

Indian corporate bonds are a reliable source for additional income

Relatively better returns in Indian corporate bonds

They help you diversify your investment portfolio and balance your portfolio.

Do you want to know about corporate bonds interest rates in India? Let me tell you that you do not need to worry about corporate bonds interest rates as the corporate bonds are known to offer the coupon rate that ranges between 7 to 14% annually. Corporate bond fund can also prove to be a good option if you wish to go for diversification. You are required to stay cautious and make investment decisions as there is a risk with every investment.

Today, investors have varied sources online and it is better to choose the online platform facilitating higher security.

If you are looking to buy bonds after detailed research, consider BondsIndia. You can explore the listed bonds available for the potential trade in a fraction of seconds.

Frequently Asked Questions

Why to buy corporate bonds?

Corporate bonds are a fixed source of income for investors in the form of interest. You get the interest paid annually or semi-annually. Also, you get the full repayment of your principal.

How secure are corporate bonds?

Corporate Bonds are more secure than other stocks. Corporate bondholders get the first priority if a bond-issuing company is declared bankrupt. Also, companies with AAA ratings are considered more secure.

What is the maturity of corporate bonds?

The corporate bonds term can range from one to thirty years. The short-term ranges from 1 to 3 years, medium-term 4 to 10 years, and long-term more than 10 years.

What are the three major types of corporate bonds?

The three major types of corporate bonds include - Short-term notes, medium-term notes, and long-term bonds.

How do Corporate Bonds differ from stocks?

Corporate Bonds are a loan from investors to the organisations issuing them while Stocks provides you partial ownership in a corporation.

What is the risk level for Corporate Bondholders?

The Corporate Bondholders have a low-risk level. Credit risk, market risk, and interest rate risk are the primary risk with Corporate Bonds.

Why prefer BondsIndia to buy bonds?

BondsIndia is a secure and user-friendly online platform for the potential investment in bonds.

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