PSU Bonds india 2026 - Government-Backed Bonds
A collection of bonds issued by public sector companies which are controlled by the Central Government.
- High Safety: Because these enterprises are backed by the Government of
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Features of PSU Bonds
Public Sector Undertakings, owned and administered by a central or state government, issue PSU bonds. These are typically medium or long-term investment plans.
Best for Investors with Low-Risk Tolerance
The government backing significantly reduces the risk of default. Credit ratings of PSU bonds are generally high. It makes these bonds ideal for risk-averse investors like retired individuals.
Long-Term Investment
The tenure of PSU bonds in India can range between 10 to 15 years.
Higher Yields than FD
Carrying low-risk like FDs, Public Sector Undertaking Bonds can generate comparatively higher returns, up to 7.00%.
Safety against Market Fluctuation
Market fluctuations or inflation rates have a low influence on public sector undertaking bonds. Thus, returns are highly ensured.
Liquidity
Bonds issued by public sector companies are highly liquid as they are tradable in the secondary market.
Suitable for High-Income Taxpayers
Listed PSU bonds have a 10% rate of long-term capital gains tax. For unlisted bonds, the rate is 20% with indexation on selling or redeeming after 3 years. Taxpayers from the 30% slab will thus incur 10% less tax.
Benefits of PSU Bonds
- Guaranteed, Steady Cash Flow: PSU bonds provide regular interest payouts right up to maturity, giving you a dependable income stream. This makes them a great fit for retirees and professionals wanting routine earnings.
- Capital Safety for the Long Haul: Long-term investing works best when shielded from market swings. Backed by government-owned enterprises, these bonds offer high capital protection so your money stays secure.
- Effortless & Predictable: You earn fixed returns without needing to constantly check market charts. It is a true "set-it-and-forget-it" investment, making it simple and stress-free even for first-time buyers.
Credit Ratings of PSU Bonds
Credit rating agencies such as CRISIL, ICRA, CARE, IND, and others evaluate and assign credit ratings to NBFC bonds by considering factors like asset quality, capitalisation, earnings, market position, liquidity, and risk management.
The subsequent classification will provide you insight into the creditworthiness of PSUbonds:
- AAA: highest degree of safety, lowest credit risk
- AA-, AA, AA+: high degree of safety, very low credit risk
- A-, A, A+: adequate degree of safety, low credit risk
- BBB-, BBB, BBB+ : Moderate degree of safety, moderate credit risk
- BB: Moderate risk of default
- B-, B, B+: high risk of default
- C: very high risk of default
- D: In default or expected to be in default
Investing in PSU Bonds
You can now explore the to-rated and best-yielding PSU bonds and invest using three simple steps on GoldenPi.
- Step 1: Register your account on GoldenPi.
- Step 2: Select from the long list of PSU bonds.
- Step 3: Monitor your bonds and enjoy returns on maturity.
