Electoral Bonds was introduced in the Budget 2017 to promote transparency in political funding. Electoral bonds can be bought from any of the branches of State Bank of India. Donation to political parties is eligible under two sections; section 80 GGC if you are an individual and section 80 GGD if you have donated as a company. The entire amount you donate is eligible for deduction. Donations exceeding Rs 2,000 cannot be made in cash. Political parties are also entitled to get an exemption on the face value of the bonds under section 13A.
According to the latest party audit, BJP received 5.1 times more party funding than the Congress party in 2017-18. While the Congress has raised just Rs 199 crore in 2017-18 against a staggering Rs 1,027 crore raised by the BJP in the same year. BJP also received 94.5% of the total electoral bond funding (Rs 210 crore out of a total of Rs 220 crore) issued. Congress received electoral bond funding of just Rs 5 crore.
Country's largest lender, SBI will raise $1 billion by selling overseas bonds. The sale will take place in two tranches. The bank will raise about $ 700 million through five- year bonds and $300 million through three-year bonds. Initially, the range of five-year bonds was fixed at 210 basis points above the US Treasury however it has now come down to 185 basis points above the US Treasury. For three-year bonds, the range was negotiated at 190 basis points above the US Treasury, but it has come down to 157 basis points.
IIFL Finance, backed by the UK-based CDC Group, is set to raise up to Rs 2,000 crore through public bond issues as it seeks to increase the share of long-term borrowings in its total debt. The bonds will open for subscriptions next Tuesday with a coupon rate of 10.5%, the highest among retail debt sold recently across three-five-ten-year maturities. The bonds will be listed on the BSE and NSE. The bond sale is expected to close on February 20.
Reliance Industries Limited (RIL) plans to launch its Rs 2,500-crore bonds issue in the next few days to repay its old loans and fund capital expenditure. The company has also initiated talks with banks to raise funds both in India and abroad for its $10 billion oil refinery planned in Gujarat.
State-owned Indian Oil Corp Tuesday said it will raise $900 million through an overseas bonds issue to meet its working capital requirements. The bonds will carry a coupon rate of 4.75%. "The Notes carry a coupon of 4.75 percent per annum payable semi-annually. The Notes will mature in 2024 and all the principal and interest payments will be made in US Dollars," the company said.
Global brokerage firm, Bank of America Merrill Lynch (BofAML), cautioned investors to stay away from equities in 2019 which may witness market volatility ahead of the general elections in the country. The foreign brokerage advised the investors to invest their money in bonds. The brokerage has set a Nifty target of 11300 by December 2019, implying limited upside from current levels. Sanjay Mookim, the India equity strategist at the brokerage said that there could be a further significant decline in the valuation of midcap stocks.
Analysts expect that Indian companies are likely to issue dollar bonds before the commencement of Lok Sabha elections. “Borrowers would like to fund themselves before the elections, just to avoid any uncertainty,” according to Augusto King, head of capital markets group for Asia at MUFG Securities. Any unexpected outcome in the general elections may push up the financing costs later. The country’s largest oil marketing and refining company Indian Oil Corporation (IOC) has hit the international bond market to raise up to $1.5 billion. State Bank of India, the country’s largest lender, is also planning for a dollar bond issuance.
Tata Cleantech Capital (TCCL), a joint venture between Tata Capital and the International Finance Corporation (IFC), on Wednesday said it has raised Rs 180 crore through its maiden five-year green bond from Netherlands-based development bank, FMO. The company, which has a strong renewable energy portfolio, said that the proceeds of the bond will be used to finance eligible green projects. FMO, the Dutch development bank, has a committed portfolio of $10.5 billion and has been supporting sustainable private sector growth in over 92 developing and emerging countries.