D S Kulkarni Developers is Pune based real estate developer with interests in Mumbai, Bengaluru, Nasik, etc has come out with Secured NCD (non convertible debentures) to raise Rs 200 Crores.
The company plans to use the proceeds of the issue to finance its DSK Dream City, an integrated township spread across more than 200 acres on the Pune-Sholapur road near Pune and few other projects under development and general corporate purpose.
D S Kulkarni NCD – Significant Points:
- Offer Period: August 4 – August 26, 2014
- Annual Interest Rates for Retail Investors: 12.50% to 13.00% depending on tenure
- Additional 0.25% Interest to Senior Citizens, Women, Serviceman, Ex-Serviceman, Employees and Shareholders
- There is also an option where the money doubles in 6 Years 6 Months (66 Months)
- Price of each bond: Rs 5,000
- Minimum Investment: 5 Bonds (Rs 25,000)
- Max Investment Limit for Retail Investor: Rs 5 Lakhs
- Credit Rating: CARE BBB+
- All NCD option are Secured
- The security is land bank valued at 1.5 times the amount raised by NCD
- Allotment: First Come First Serve
- Listing: Bonds would be listed on BSE and will entail capital gains tax on exit through secondary market
- NRIs cannot invest in the issue
- You can subscribe both in Demat and Physical form
- There is no TDS if the subscription is in Demat form while TDS @ 10% would be deducted on interest received on Physical forms.
Also Read – Know NCD – Investment Tips, TDS and Taxation
D S Kulkarni NCD – Investment Options:
There are 4 options of investment in DS Kulkarni NCD.
The Option III has Staggered Payment every year as follows:
Following are the classification of Investors:
- Category I is Institutional Investors
- Category II is Non-Institutional Investors
- Category III is Individual Investors
80% of the Issue is reserved for Category III i.e, Retail Individual Investors
Why you should invest?
- The interest offered is best among all the recent and listed NCDs or fixed income options
- It’s a well know listed company in Real Estate space
- The NCD is secured. So in case of default by the company the land bank may be liquidated and investors might be paid back.
Why you should not invest?
- The rating is BBB+ which indicates moderate credit risk.
- The company operates in real estate and things have not been great for them from past several years. With over priced real estate the slowdown may continue leading to downgrading of credit rating.
- The profits have been declining like most of real estate players. If the trend continues there may be further credit risk.
- Though NCDs are listed on stock exchange, the liquidity is very low. So it might be difficult to exit anytime you want. You might have to sell at discount to exit
How to Apply?
If you have Demat account apply through that. It’s the easiest way to apply and also avoids a lot of hassle in terms of KYC and paper work
In case you don’t have Demat Account, you can download the application form from company site or Financial Institutions and submit to collection centers.
- The DS Kulkarni NCD is high risk high return kind of investment. Its on you if you want to take that risk for fixed income investments.
- If you are too tempted with the interest offered, you might invest only a small percentage of your fixed income portfolio in this NCD
- You should always have diversified portfolio be it fixed deposit, NCD or equity investment
- Its good idea to remain invested till maturity because liquidity on exchanges are low and hence you would get lower than market value
5 thoughts on “13% D S Kulkarni Secured NCD – August 2014 – Should you Invest?”
Reagrding Ds kulkarni NCD 12.75%, I bought it.
But not yet received interest.
No interest paid for NCD. What should i do ?
Whom should we ask ?
My email: [email protected]/ 9663139350
Rating revised to D by CARE. That means default. Now long process of land liquidation and SEBI investigation starts. Hope to get principal amount back in few years.
DSK failed to repay matured FD’s and even interest on FD’s in Nov-Dec of 2016. Investors are struggling to get their money back. Please rethink before investing in DSK.
Its true i am one of the investor.Cheque for maturity amount has been dishonoured.Tried contact on phone the are not responding.Via email they are just telling me that our team will conatct you shortly but no specific time is mentioned in that.I wan file a compliant against DSK how can i please help me also how to complain in SEBI ?
I have also invested in DSK FD with ECS (instead of cheque) on maturity.Lately, I came to know about this fact about FD amount not getting returned.
What is the current status and what are our options ? Were you able to get back your money?
My FD are maturing in few days and will appreciate any help