What a corporate bond is
A company, NBFC, bank or public sector undertaking borrows from investors by issuing bonds or non-convertible debentures (NCDs). You get a fixed coupon and your money back at maturity — as long as the company can pay.
Read the rating first
SEBI-registered rating agencies grade each issue:
| Rating | What it signals |
|---|---|
| AAA | Highest safety |
| AA | High safety |
| A | Adequate safety |
| BBB | Moderate safety — the lowest "investment grade" |
| BB and below | Speculative; real risk of missing payments |
| D | In default |
A higher coupon nearly always means a lower rating. Ratings can be downgraded, so check the latest one, not the one at issue.
Coupon vs yield
If an NCD with a 9% coupon trades at ₹1,020 for ₹1,000 face value, your yield to maturity is below 9%. Platforms show the YTM — use it to compare.
Where to buy
- Public issues (NCD IPOs), applied through your bank with ASBA or UPI, like a share IPO.
- Stock exchanges (NSE, BSE) through your demat account.
- Online bond platforms registered with SEBI as online bond platform providers.
Many issues can now be bought from ₹10,000 of face value. Check how to invest in bonds for the steps.
Questions to ask
- Who is the issuer and what is its rating? Is the bond secured (backed by assets) or unsecured, senior or subordinated?
- Is there a call option that lets the company repay early if rates fall?
- How often does it trade? Can you hold it to maturity if you can't sell?
- How much of your savings is with one company? Spreading across issuers limits the damage of one default.
Interest is taxed at your slab rate; gains on listed bonds held over 12 months at 12.5%.
For general information only, not investment advice or a recommendation. Oxon Fintech is a loan facilitation platform, not a SEBI-registered investment adviser, bank or mutual fund distributor, and does not sell bonds, deposits or funds. Rates and rules are as checked on the date above; confirm with the issuer, bank or fund house before investing. Mutual fund investments are subject to market risks; read all scheme-related documents carefully.