TOPIC 30: QUICK REFERENCE TO “Issue of Debentures at a Discount and Basics of Bonds”

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Quick reference to " Issue of Debentures at a Discount and Basics of Bonds":-
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1. The Company can absolutely issue Debentures at Discount.
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2. Section 53 i.e. Prohibited Issue of shares at Discount is not applicable to issue Debentures at Discount.
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3. If Debentures are converted into equity shares then Conversion should be at par or at premium.
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Bonds:-
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1. It is a Form of Loan.
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2. Issued by Financial Institutions, RBI, Govt, & Company.
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3. Helps to meet ling term funding requirement.
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4. The term Debenture includes Bond as per section 2(30) of Companies Act, 2013.
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5. Deep discount bond is also known as Zero Coupon Bond.
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6. Sovereign bonds are issued by RBI. It is also known as Risk-free bond.
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7. Bonds can also be converted into equity shares.
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8. Normally, at the maturity date Principal is repaid.
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REGARDS
ACA SOURAV BAGARIA