NCD and Bonds Articles
Non-Convertible Debentures are the bonds that are sold by various companies that can be easily converted in the equity on maturity. The principal amount and the interest are usually paid to the investors on the maturity in case of NCD.
The NCD is of two types; it has secured and unsecured NCD. The secure NCD is backed by the company’s asset. In case if the company faces a failure to pay the principal on maturity, then the investors has the right to claim payment by the liquidation of assets. The unsecured NCD are not usually backed by any asset. They have more risk as compared to the secure NCD.
The NCDs may get listed on the various stock exchanges where the investors can sell before it gets mature. The company may raise funds by NCD taking the help of NCD Public Issue.