How do you know a ZCB is forthcoming?
Once the Central Government is satisfied that the above conditions have been fulfilled the issuer announces it through a notification in the official gazette. In respect of ZCB which are notified by the Government there shall be mentioned:

a. Name of the bond;
b. Period of life of the bond;
c. The time schedule of the issue of the bond;
d. The amount to be paid on maturity or redemption of the bond;
e. The discount; and
f. The number of bonds to be issued.

Now the million dollar question - to invest or not to invest ?

Zero Coupon Bonds are going to be started for the first time in India. However, there is no doubt that the clear cut guidelines with reference to investment pattern of the money raised on Zero Coupon Bond and other requirement and conditions as imposed by the Government puts strict checking on the persons issuing Zero Coupon Bond to the investors. So it's safe.

More particularly, the listing of Zero Coupon Bond would make it liquid investment. Investment in these bonds would really be preferred investment for all those persons who want safety and security of the investment coupled with liquidity and reasonable return on the investment.

So like aspirin became synonymous with pain relief, let's hope Zero Coupon Bonds becomes synonymous with good investing. But unlike aspirin, we're sure that no side effects will pop up later.

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e-mail: Subhash Lakhotia

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