IFCI Infrastructure Bonds Series 4 Posted: 11 Dec 2011 01:56 AM PST IFCI Ltd has launched IFCI Infrastructure Bonds  Series IV under private placement having Benefits under section 80CCF of the income Tax, 1961 for Long Term Infrastructure Bonds. It is advisable to invest in these bonds because they are offering highest rate ever offered by any tax saving infrastructure bond. Also, we don’t expect upward movement in interest rates from here onwards. Main points of the issue are: The issue is open from November 30, 2011 and will remain open till January 16, 2012. However, the issuer would have an option to pre-close or extend the issue by giving 1 day notice to the arrangers. Deemed date of allotment- February 15, 2012. The benefit under section 80 CCF is limited to Rs. 20,000 in a financial year, but there is no limit on investment. Cheque/DD/Pay order, drawn and made payable in favour of “IFCI Limited – Infra Bond” and crossed “Account Payee Only” The PAN No of the Sole / First Applicant and all Joint Applicants(s) should be mentioned correctly in the Application Form. If the applicant opts for bonds in physical certificate form, then the self certified copy of the PAN Card of the sole/first holder and self certified address proof of the sole/first holder along with cancelled cheque must be attached to the application form. Don’t wait till last date, as interest on application money will be paid as per bonds applied from data of cheque realization Ask for the Form at -  jainbroker@yahoo.in   Issuer IFCI Limited (“the Issuer”) Offering 2,00,000 Nos. Unsecured, Redeemable, Non-Convertible Bonds Series – IV of Rs.5,000/- each aggregating to Rs.100 crore with a green-shoe option to retain over-subscription. Type Private Placement basis Instrument Unsecured, Redeemable, Non-Convertible Long Term Infrastructure Bonds – Series IV, having benefits under section 80 CCF of the Income Tax Act, 1961 for investment upto Rs.20,000/- Eligible Investors Resident Indian Individuals (Major) and HUFs through Karta of the HUF Rating ‘BWR AA-’ by Brickwork Ratings India Pvt. Limited CARE ‘A+’ by CARE Ratings (Credit Analysis & Research Ltd.) ‘LA’ by ICRA Limited Face Value Rs.5,000/- per bond Minimum Application Rs.5,000/- (i.e. 1 Bond) Application in multiples of Rs.5,000/- (i.e. 1 Bond) Options for Subscription I II III IV Frequency of Interest Payment Cumulative Annual Cumulative Annual Coupon (% p.a.) 9.09 % p.a. (Annual compounding) 9.09 % p.a. 9.16 % p.a. (Annual compounding) 9.16 % p.a. Tenor 10 (Ten) years 10 (Ten) years 15 (Fifteen) years 15 (Fifteen) years Maturity Date February 15, 2022 February 15, 2022 February 15, 2027 February 15, 2027 Buyback option At the end of 5th and 7th year from Deemed Date of Allotment At the end of 5th and 10th year from Deemed date of Allotment Buyback Dates February 15 of the calendar years 2017 and 2019 February 15 of the calendar years 2017 and 2022 Lock-in period 5 years from the deemed Date of Allotment Deemed Date of Allotment February 15, 2012 Security Unsecured Trustee IDBI Trusteeship Services Limited Listing Proposed to be listed on Bombay Stock Exchange (BSE) Depositories National Securities Depository Ltd. and Central Depository Services (India) Ltd. Registrars Karvy Computershare Pvt. Ltd. Issuance & Trading Bonds shall be issued both in dematerialised form and physical form. However, trading allowed only in dematerialised mode after the expiry of Lock-in Period of 5 years Mode of Interest Payment / Redemption ECS/At Par Cheques/Demand Drafts Issue Schedule Issue Open Date : November 30, 2011 Issue Close Date : January 16, 2012 The issuer would have the right to pre-close the issue or extend the closing date by giving 1 day notice to the Arrangers Interest on Application Money shall be paid at the respective coupon from the date of realisation of subscription amount to the date immediately preceding the deemed date of allotment.

Why I continue to invest in stocks? Posted: 12 Dec 2011 08:40 AM PST As the investment climate turns more pessimistic by the day – more and more people are turning away from the stock market – and I’m being asked by friends why I continue to remain bullish when there is so much bad news coming in from all directions. The answer to that is I’m not bullish in the sense that the market will go up next month or next year or in any other ways that people generally think about being bullish. Yes, I’ve bought stocks in the last few months, and will continue to do so in the coming months, but the reason for that is not because I’m bullish in the sense that most people think about it. I have no idea where the market will be next month or next year or two years down the line, but I do believe that companies will continue to exist and make profits many many years down the line, and as long as I invest in companies that don’t go bankrupt and with money that I won’t need in a hurry I think I will come out fine. I recently re-read some parts of The Intelligent Investor, which is of course considered the bible of value investing, and I think two excerpts from the book capture how I feel quite nicely. Here is the first one: A stock is not just a ticker symbol or an electronic blip; it is an ownership interest in an actual business, with an underlying value that does not depend on its share price. The market is a pendulum that forever swings between unsustainable optimism (which makes stocks too expensive) and unjustified pessimism (which makes them too cheap). The intelligent investor is a realist who sells to optimists and buys from pessimists. Except for the first one or two years of investing when I was still in college – I’ve viewed stocks as representatives of companies and that makes it a lot easier to go through all the volatility that exists in the market today, and has always existed. I think this mindset improves the chances of investing success phenomenally but I have no illusions of never making any mistakes, and I’m pretty sure there will be some mistakes and that’s really not in my control. I can’t be error free but I can diversify in a way such that those errors are not very costly. Jason Zweig has added commentary to the issue of The Intelligent Investor I currently have, and I think this excerpt captures the essence of what I want to say about errors quite nicely. The probability of making at least one mistake at some point in your investing lifetime is virtually 100%, and those odds are entirely out of your control. However, you do have control over the consequences of being wrong. Many “investors” put essentially all of their money into dot-com stocks in 1999; an online survey of 1,338 Americans by Money Magazine in 1999 found that nearly one-tenth of them had at least 85% of their money in Internet stocks. By ignoring Graham’s call for a margin of safety, these people took the wrong side of Pascal’s wager. Certain that they knew the probabilities of being right, they did nothing to protect themselves against the consequences of being wrong In my opinion – I can be wrong about two things – first about investing in stocks itself – five years down the line I could find that companies aren’t making profits any longer or less than they were five years ago and the macro situation was so bad that stock prices are just a third of what they were a few years ago. And to get away from this risk one could invest in debt instruments, real estate, gold or just keep cash – basically not invest 100% in stocks. The second risk is stock specific risk and to get away from that you can invest in multiple stocks and especially stocks that have been around for decades, have low debt, high dividends and good fundamentals. This will at least minimize the chances of bankruptcy and if you have ten stocks in different sectors or large cap diversified mutual funds then you are protected from stock specific risk quite easily. I’m not a market trader and I don’t pretend to understand everything that’s happening in Europe or how it will play out in the future – but I do know what has worked for me in the past and I have high confidence that companies that have been around for decades will continue to exist in the future as well and make profits. At this point, this is enough to make me interested in stocks, and be bullish as they say.

JAIN BROKER

JAIN BROKER