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Meghalaya Energy Corporation Limited

Coupon

11.01%

Maturity

20-Dec-2030

Rating

CRISIL AA-

Interest Date

Quarterly

Face Value of Security

1 Lac

Benefits Of Investing In MLDs With Choice

Choice Advantage

Choice Advantage

  • Curated Portfolio of AA+ Rated MLDs
  • Preferential Access to High-demand Issues
  • Preferential Access to High-demand Issues
Expert Advisory

Expert Advisory

  • Dedicated Relationship Manager
  • Research-backed Recommendations
  • Active Portfolio Monitoring

How to Invest in Market Linked Debentures?

Starting your MLD investment journey involves five strategic steps:

STEP 1

Open A Free Online Account

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STEP 2

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STEP 3

Select & Verify Your Investment

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STEP 4

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What Are Market Linked Debentures?

Market Linked Debentures combine bond stability with market-linked returns. These structured products offer principal protection at maturity while providing exposure to market opportunities through designed payoff structures. MLDs are available in two types, each serving specific investment objectives:

Index-Linked MLDs

Linked to Market Indices

Returns are based on the performance of broad market indices like the Nifty 50 Index or Sensex.

Objective

Provide exposure to market movements, offering diversification and potentially higher returns based on index performance.

Stock-Linked MLDs

Linked to Market Indices

Returns are tied to the performance of individual stocks or a basket of stocks.

Objective

Offer concentrated exposure with returns based on the performance of specific companies instead of broader market indices.

Risks Associated with MLDs

Credit Risk

Credit Risk

The principal protection and returns depend on the issuer's ability to meet financial obligations. We recommend focusing on high-credit-rated issuers to manage this risk.

Market Risk

Market Risk

While the principal is designed for protection at maturity, returns depend on market performance. Adverse market movements may impact potential returns.

Liquidity Considerations

Liquidity Considerations

MLDs are typically held to maturity. Secondary market liquidity may be limited, and early exit could result in a significant impact on returns.

Structure-Specific Risks

Structure-Specific Risks

Each MLD's performance depends on its specific structure and underlying components. Understanding these elements is crucial for investment decisions.

5 Reasons To Invest In MLDs

#1

Potential Higher Returns

Returns are linked to market indices, potentially offerinig higher returns than traditional fixed-income products.

#2

Capital Protection

Some MLDs offer partial or full capital protection at maturity, subject to issuer credit risk and specified terms. Making them an attractive option to conservative investors.

#3

Strategic Diversification

MLDs provide exposure to different markets, offering an alternative to traditional fixed-income and equity investments. They can help diversify your investment portfolio.

#4

Inflation Hedge

Equity-linked returns may help investors who seek protection against inflation over time.

#5

Customisable Participation

MLDs offer structured exposure to market opportunities through designed payoff structures. Investors can select products specifically tailored to their risk and return preferences.

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Market Linked Debentures FAQs

MLDs are structured debt instruments that combine principal protection at maturity with market-linked returns. They offer exposure to market opportunities while maintaining defined protection parameters.

While NCDs offer fixed returns, MLDs provide market-linked returns with principal protection at maturity. The return structure in MLDs depends on underlying market indicators rather than fixed interest rates.

The minimum investment typically starts at Rs. 10 lakhs, as per current regulatory requirements. This threshold may vary by issue and issuer.

SEBI-registered entities including banks, NBFCs, and corporate bodies can issue MLDs, subject to regulatory requirements and credit rating criteria.

Returns are determined by the performance of underlying market indicators as per the specified structure. Each MLD's term sheet details the exact calculation methodology.

MLDs usually have tenures ranging from 13 months to 5 years, designed to optimise tax efficiency and market participation opportunities.

Credit rating agencies assess MLDs based on issuer creditworthiness. Choice focuses on AA+ and above-rated issues for better risk management.

While possible, early exit may impact returns and principal protection features. MLDs are designed as hold-to-maturity instruments.