What are Public Sector Undertaking Bonds (PSU Bonds)?

Average returns8.50%

Average Yield8.30%

Min. Investment₹1000

What are Public Sector Undertaking Bonds (PSU Bonds)?

Public Sector Undertaking Bonds (PSU Bonds) are bonds in which the government shareholding is generally more than 51%. It is a medium and long-term debt instrument issued by public sector companies. Indian Oil Corporation Limited is the biggest PSU in India.

Checking the credit rating and nature of bonds is always recommended. Ensure the credit rating, Investment nature, underlying security, and maturity align with your investment needs. PSU Bonds are considered a secure option for investment.

Best PSU Bonds for your investment

Top Bonds		Coupon(%)	Rating	Yield(%)
IFCI LIMIT... INE039A09NM1	Price ₹ 10,000	Coupon 0%	Rating B+	Yield 12.5%	INVEST NOW
PTC INDIA ... INE0PBP15014	Price ₹ 100,000	Coupon 10.6%	Rating A+	Yield 11%	INVEST NOW
NATIONAL I... INE168X08014	Price ₹ 1,000,000	Coupon 8.35%	Rating A+	Yield 10.91%	INVEST NOW
IFCI LIMIT... INE039A09LK9	Price ₹ 1,000,000	Coupon 9.55%	Rating B+	Yield 10.76%	INVEST NOW
IFCI LIMIT... INE039A09NW0	Price ₹ 10,000	Coupon 10.75%	Rating AA-	Yield 10.73%	INVEST NOW
IFCI LIMIT... INE039A09NL3	Price ₹ 10,000	Coupon 10.75%	Rating B+	Yield 10.67%	INVEST NOW
IFCI LIMIT... INE039A09LM5	Price ₹ 1,000,000	Coupon 9.7%	Rating B+	Yield 10.35%	INVEST NOW
IFCI LIMIT... INE039A09PN4	Price ₹ 25,000	Coupon 9.9%	Rating BB-	Yield 10.23%	INVEST NOW
IFCI LIMIT... INE039A09PP9	Price ₹ 25,000	Coupon 9.9%	Rating B+	Yield 10.07%	INVEST NOW
IFCI LIMIT... INE039A09PD5	Price ₹ 100,000	Coupon 9.98%	Rating B+	Yield 10.05%	INVEST NOW
IFCI LIMIT... INE039A09LL7	Price ₹ 1,000,000	Coupon 9.7%	Rating BB+	Yield 10.05%	INVEST NOW
IFCI LIMIT... INE039A09MD2	Price ₹ 1,000,000	Coupon 9.75%	Rating B+	Yield 10%	INVEST NOW
IFCI LIMIT... INE039A09OM9	Price ₹ 10,000	Coupon 10.7%	Rating B+	Yield 9.92%	INVEST NOW
IFCI LIMIT... INE039A09PR5	Price ₹ 1,000,000	Coupon 9.75%	Rating BB-	Yield 9.88%	INVEST NOW
IFCI LIMIT... INE039A09MC4	Price ₹ 1,000,000	Coupon 9.75%	Rating B+	Yield 9.8%	INVEST NOW

Best PSU Bonds for your investment

Rating
All

Coupon(%)
All

Yield(%)
All

IFCI LIMITED
INE039A09NM1

Price
₹ 10,000

Coupon
0%

Yield
12.5%

Rating
B+

INVEST NOW

PTC INDIA LTD
INE0PBP15014

Price
₹ 100,000

Coupon
10.6%

Yield
11%

Rating
A+

INVEST NOW

NATIONAL INSURANCE C...
INE168X08014

Price
₹ 1,000,000

Coupon
8.35%

Yield
10.91%

Rating
A+

INVEST NOW

IFCI LIMITED
INE039A09LK9

Price
₹ 1,000,000

Coupon
9.55%

Yield
10.76%

Rating
B+

INVEST NOW

IFCI LIMITED
INE039A09NW0

Price
₹ 10,000

Coupon
10.75%

Yield
10.73%

Rating
AA-

INVEST NOW

IFCI LIMITED
INE039A09NL3

Price
₹ 10,000

Coupon
10.75%

Yield
10.67%

Rating
B+

INVEST NOW

IFCI LIMITED
INE039A09LM5

Price
₹ 1,000,000

Coupon
9.7%

Yield
10.35%

Rating
B+

INVEST NOW

IFCI LIMITED
INE039A09PN4

Price
₹ 25,000

Coupon
9.9%

Yield
10.23%

Rating
BB-

INVEST NOW

IFCI LIMITED
INE039A09PP9

Price
₹ 25,000

Coupon
9.9%

Yield
10.07%

Rating
B+

INVEST NOW

IFCI LIMITED
INE039A09PD5

Price
₹ 100,000

Coupon
9.98%

Yield
10.05%

Rating
B+

INVEST NOW

IFCI LIMITED
INE039A09LL7

Price
₹ 1,000,000

Coupon
9.7%

Yield
10.05%

Rating
BB+

INVEST NOW

IFCI LIMITED
INE039A09MD2

Price
₹ 1,000,000

Coupon
9.75%

Yield
10%

Rating
B+

INVEST NOW

IFCI LIMITED
INE039A09OM9

Price
₹ 10,000

Coupon
10.7%

Yield
9.92%

Rating
B+

INVEST NOW

IFCI LIMITED
INE039A09PR5

Price
₹ 1,000,000

Coupon
9.75%

Yield
9.88%

Rating
BB-

INVEST NOW

IFCI LIMITED
INE039A09MC4

Price
₹ 1,000,000

Coupon
9.75%

Yield
9.8%

Rating
B+

INVEST NOW

More About PSU Bonds in India

PSU bonds meaning - understanding the key terms and PSU bonds meaning can help you have a better understanding. Unlike other bonds, PSU bonds are also preferred by a certain percentage of the investors in India.

PSU Banks, power sector companies, railways, and other organisations issues PSU bonds as they have 51% of the government shareholding with them. These entities could be held by central or state government.

Public Sector Undertaking Bonds (PSU Bonds) unlike other bond types is a good source of investment for investors. It has its own importance. There are many advantages of investing in PSU bonds.

Comparatively higher rate of interest

Minimal risk of default

Suitable for High-income Taxpayers

Yield in PSU bonds are stable

It is good option for Long-term Investment

PSU bonds are issued by government entities and hence it is considered one of the safest investment options. The return on investment is also an attraction for many of the investors. You can expect the annual returns at 8% to 9% interest rate. The yield on PSU Bonds in India is higher in comparison to many other debt instruments in the Indian market.

Experts recommends investing in bonds with good credit rating. It can help you earn a fixed income and higher yield on the investment made. Also, the diversification of your portfolio can prove useful in accomplishing your various financial goals in life.

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PSU Bonds in India Key Features

Higher interest rate than FDs.
Generally, these bonds are taxable as per individual income tax slab.
Low default risk as they are backed by the Government.

Why you should Invest in PSU bonds?

If you have a low risk-taking capacity, you should opt for banking and PSU bonds. Simply because the units belong to PSU companies and banks, which are supported and run by the government. It is a good investment instrument for investors paying higher income tax. The public sector bonds have gained importance among the new investors. The widespread of the awareness may result in increased demand of public sector bonds in the near future.

Advantages of PSU Bonds for Investors

Suitable for High-income Taxpayers

Taxation is the main reason for you to opt for PSU bonds over Credit risk funds. Investors, who continue to hold profits of bonds beyond three years, usually have to pay long term capital gains tax of 20% with indexation benefit. However, if you continue to hold PSU bonds for less than three years, you will have to pay short-term capital gains tax according to your income slab.

Stable Yields

PSU bonds remain invested in the mid segment of the yield curve in the 2-4 years. This segment accounts to have stable yields with much lower volatility levels with respect to the long-term debt funds. Keeping in view of the interest rate, Investors are recommended to have major chunks of their fixed Investment allocation in these products. The annual returns offered in PSU bonds are at the rate of 8% to 9%.

Long-term Investment

PSU bonds are a good investment instrument for investors in India. Keep investing in PSU bonds for a longer duration as it will yield you relatively better returns subject to price fluctuations in the market.

Who Should Invest in PSU Bonds?

PSU bonds are suitable for high income tax payers. It can prove to be a good investment instrument for many investors. Purchasing PSU Binds is simple and easy. You do not need to be an investment expert.

BY investing in top performing public sector bonds, you can diversify your portfolio and achieve certain financial goals.

Choosing the best from the many online platforms for investment in bonds and other securities can help you have a better investment experience.

BondsIndia is the dedicated online platform aimed at providing users the easy access to the range of bonds. You can explore the various investment products at BondsIndia for the informed decision on buying bonds.

If you wish to explore bonds for the potential investment, create your account at BondsIndia

Frequently Asked Questions

In what denominations PSU bonds are issued in India?

PSU bonds are issued in the denomination of Rs. 1000 each in India.

What is the maturity duration for PSU bonds?

PSU bonds in India have maturities ranging between 5 and ten years.

Are PSU Bonds safe?

The high-yielding PSU debt comes in the category of PSU bonds held by PSU banks. These are certainly at high risk as they can be written down when the bank’s capital falls below specific thresholds. The bank does not have to be insolvent for the bonds to be written down. The bank can be bailed out, as what happened with Yes Bank.

Is investing in PSU bonds challenging?

Investors do not need to have any market knowledge on interest movements if they want to Invest in PSU bonds and don’t have to be anxious about tracking. You can Invest freely in PSU bonds whenever you want.

What are the key advantages of investing in PSU bonds?

Relatively higher interest rates and low risk of default due to government guarantee.

Is buying bonds through BondsIndia safe?

Yes, BondsIndia offers a safe and secure online platform for investments in different bond types.

How can I trade in bonds at BondsIndia?

You need to become a registered member to trade in bonds at BondsIndia. Registering at BondsIndia will take only a few minutes.

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