There is no application process offered by Zerodha for the NCD NFO (new fund offer). You can apply for NCD issuance using your Zerodha Demat account information on the websites of ASBA-supported banks or the NCD issuing company.
Although Zerodha does not enable applicants for NCD public issues, you can purchase listed NCDs through Zerodha Kite. Purchasing listed NCD follows a similar procedure to purchasing stock in a corporation.
Note:
- It is not possible to pay for NCD NFOs using UPI. Therefore, the majority of stock brokers do not provide online NCD public issue.
- The only option to apply for NCD IPO online is through ASBA.
- Like corporate shares, listed NCDs are traded on a stock exchange. But they have very little liquidity.
- In the secondary market, NCD liquidity is typically relatively low.
- Although you cannot take money out of an NCD before it matures, you can sell it once it is listed on an exchange.
Zerodha NCD IPO Application :
There isn’t an online NCD public issue application available from Zerodha. Through your bank’s ASBA IPO application capability, you can submit an application for an NCD public offering. The allotted NCDs are deposited in the Zerodha demat account if you enter the Zerodha Demat Account Number while submitting an application for an NCD public issue.
How to apply online for an NCD IPO through a bank that is supported by ASBA :
- Log in to your net banking website or mobile app.
- Go to the IPO section.
- Look for the desired NCD you wish to apply.
- Enter the no. of NCD to be applied.
- Select the NCD option based on your choice of NCD nature (secured/unsecured), tenor, and interest frequency payment.
- Enter the Zerodha Demat account details.
- Click on submit.
NCD Trading in Zerodha :
Similar to publicly traded firms, NCDs are debt products listed on the BSE and NSE stock markets. They are exchanged in the open market similarly to how equities stocks are traded. Because NCDs are long-term investments, their trading liquidity is typically relatively low. On the BSE website, you can look for the NCD maturity information, coupon rate, and NCD type.
Using your Zerodha trading account, you can trade NCDs. Like with equity equities, NCD trading and settlement take place. On T+2, you receive credit for the NCD instrument that you bought on T day in your Demat account.
Steps for NCD Trading in Zerodha :
- Login to Zerodha Kite Website or Mobile App.
- Type the NCD name in the search box. (visit BSEIndia.com to get the NCD name)
- Select the instrument series you want to invest in.
- Place a buy/sell order as desired for the required quantity.
- The list of NCD instruments starts with the ‘N’ series.
Zerodha NCD brokerage Charges :
Similar to brokerage-free equity delivery (cash & carry) deals, Zeroda offers no-brokerage NCD investments. Although NCD investments are free of brokerage fees, the consumer is still responsible for paying all necessary taxes and demat fees.
Zerodha charges a fixed Rs 20 in brokerage for NCD intraday trades.
Conclusion :
Through the possibility to trade in listed NCD debt instruments through Zeroda Kite, Zerodha provides its clients with the opportunity to diversify their portfolios. Despite having substantially less liquidity, trading in NCD products is very similar to trading in equity stocks. Although you cannot take money out of an NCD before it matures, you can sell it once it is listed on an exchange.