FD and Bonds
Aadi Wealth offers a list of Bonds varying in tenure, interest rate & organization in which you may chose to invest. 
Bond Name Ratings Tax Benefit Tenure (yers) Interest Date Mode of Interest
National Highway Aothority of India AAA/Stable by CRICIL Sec 54 EC 3 Year 1st April* Annual
RBI Bonds NA NA 6 Year 31st July & 31st Jan Half Yearly
REC Bonds AAA Sec 54 EC 3 Year 30th June Annual
*1st Working day of Apr every year
What is Bond?
A bond is a debt security in which the authorized issuer owes the holders a debt and depending on the terms of the bond is obliged to pay interest (the coupon) and/or to repay the principal at a later date, termed maturity. (It is a formal contract to repay borrowed money with an interest at a fixed intervals).When you purchase a bond; you are lending money to the issuer which may be a government, corporation, federal agency, or other entity. In return for the loan, the issuer promises to pay you a specified rate of interest during the life of the bond and to pay back the face value of the bond or the principal when it "matures," or comes due.
Types of Bonds
  • Zero coupon bonds - Zero coupon bonds do not pay any interest. They are issued at a substantial discount to par value.  The bond holder receives the full principal amount on the redemption date.
  • G-Sec Bonds - Government Securities is a bond where government is an issuer or borrower. It is the safest form of bond as it is unlikely that the government defaults. Government issues bonds to raise money for funding infrastructure development, support subsidies or several other initiatives.
  • Corporate Bond - Corporate Bond are issued by the corporates i.e. Public or Private companies to investors. The company borrows money from investors and promise to pay interest at regular intervals. The interest rates on such bonds are high compared to government bonds as the probability of government defaulting on interest payments is low compared to a corporate.
  • Inflation Linked Bond - In Inflation linked bonds; principal and the interest payments are indexed to inflation. The interest rate is usually lower than that of fixed rate bonds with a comparable maturity.
  • Convertible Bond - The holder of a convertible bond has the choice to convert the bond into equity (in the same value as of the bond) of the issuing firm (borrowing firm) on pre-specified terms. This results in an automatic redemption of the bond prior to maturity date.
Why Invest in Bonds
  • For Capital Preservation
  • For a steady stream of income
  • Tax Advantage
  • Low-Risk Investment
Capital Gain Bonds
The amount of capital gains made by a tax paying individual or entity (after deducting the purchase/transaction costs and adjusting for indexation) can be invested in notified bonds under section 54 EC. These bonds are called Capital Gains Tax Savings Bond. The minimum holding period is 3 years. Capital gains savings bonds are those issued by the following institutions: REC & NHAI

Investors should ensure that these bonds are not transferred or converted within a period of 3 years from the date of acquisition. In such an event gains would be taxable.

When a property is sold and a long-term capital gains liability arises, the assessee has an option to avoid it by investing the capital gains in another property within the specified time duration.

The other option available to him to avoid paying tax is by investing the requisite sum in capital gains bonds within a period of 6 months from date of transfer.

These bonds have to be held for a period of 3 years and no loan, mortgage or any encumbrances should be created on these bonds. However the interest on these bonds is taxable.