TATA Capital Financial Services Limited (“TCFSL”) NCDs

Frequently Asked Questions

Q 1: What are Non-Convertible Debentures (NCDs)?

Answer: NCDs are instrument of indebtedness of the issuer to the holders and cannot be
converted to company equity or stock. NCDs usually have higher interest rates
than convertible debentures.

It is a debt security, under which the issuer owes the holders a debt and, depending on the
terms, is obliged to pay them the coupon and/or to repay the principal at a later date,
termed the maturity date. These are listed and traded on the exchanges. NCDs can be both
Secured and Unsecured.

Q 2: What is the difference between Secured and unsecured NCDs?

Answer: Secured NCDs are tied to an asset that is considered collateral for the debt while
with unsecured NCDs, lenders don't have rights to any collateral for the debt.

Q 3: What is the opening and closing date of TCFSL NCD issue?

Answer: The issue will open for subscription on Monday, September 10, 2018 and will close
on Friday, September 21, 2018. In case if the issue gets oversubscribed before the issue
closure date, the Company may pre close the issue at an early date.

Q4: What is total issue size, face value per NCDs and allocation to Retail & HNI investor
category?

Answer: The total issue size is upto Rs. 7,500 Crores and each NCD has face value of Rs.
1000/-. The allocation to both Retail and HNI category is 30% each of the total issue size.

Q 5: What is the investment limit prescribed for Retail and HNI investors?

Answer: The limit prescribed in Investor Category IV (Retail Individual Investor Portion) is
upto Rs. 10 lacs and in Category III (High Net Worth Individual Portion) is above Rs. 10 Lacs.

However, both retail and HNI investors will enjoy the same coupon and effective yield in this
NCD issue across all investment options.

Q 6: What is the rating of these debentures and what does it indicates?

Answer: CRISIL & CARE have given ‘AAA’ / Stable rating to these debentures which
indicates the highest degree of safety regarding timely servicing of financial obligations.
Q 7: What are the options and scheme available for investment in this issue?

Answer: The issue has three investment options to choose from viz. 3 years, 5 Years
(Secured option) and 10 Years (unsecured option) with annual interest payout option in each
option.

Q 8: What is maximum return which an Individual investor can earn out of this NCD issue?

Answer: The maximum coupon in secured option is 8.90% p.a. offered for 5 Years tenure
and 9.10% in unsecured option for 10 Years for Retail as well as HNI investors.

Q 9: In what form I can hold these NCDs? Is it mandatory to have demat account to invest in
this issue?

Answer: Yes. It is mandatory to have demat account to invest in these NCDs. Customers
who invest online would get allotment in linked ICICI Bank demat account while those who
invest offline (i.e. by filling up an application form) would have to compulsorily fill the demat
a/c details on the form.

Q 10: What is the liquidity of these debentures? Do I have an option to exit before maturity
or there is a lock-in?

Answer: These NCDs are tradable and are proposed to be listed on BSE & NSE. Once listed,
one can Buy/Sell these in the secondary market.

However, listed bonds and debentures at times have limited liquidity which results in
volatile prices. Hence, for the benefit of our customers we have disabled market orders and
customers can only place limit orders in order to trade in the secondary market.

Q 11: What is the basis of allotment for TCFSL NCDs?

Answer: Allotment shall be made on a First Come First Serve basis across all categories, on
a date priority, to be determined on the basis of the date of uploading of each application
into the electronic system of the exchange.

If there is any under subscription in any Category, priority in Allotments will be given in the
following order: (i) the Retail Individual Category Portion; (ii) High Net-worth Individual
Category Portion, (iii) Non-Institutional Portion; (iv) Institutional Portion, on a first come first
serve basis.

In case of an oversubscription, Allotments to the maximum extent, as possible, will be made

on a first-come first-serve basis and thereafter on proportionate basis, i.e. full Allotment of
the Secured NCDs to the Applicants on a first come first basis up to the date falling 1 (one)
day prior to the date of oversubscription and proportionate allotment of Secured NCDs to
the applicants on the date of oversubscription (based on the date of upload of each
Application on the electronic platform of the Stock Exchanges, in each portion).

Q 12: What is the taxation in these NCDs?

Answer: Interest earned/accrued will be treated under the head income earned from other
sources and shall be taxed as per the marginal tax slab of the investor.

Also, Capital Gain (CG) tax shall apply upon selling in the secondary market as per the
following conditions:

Short term CG tax: If sold within one year from the deemed date of allotment, taxed at
marginal tax rate.

Long Term CG tax: If sold after one year from the deemed date of allotment, taxed @ 10%
flat without indexation benefit.

Q 13: Will TDS be deducted from the interest earned?

Answer: There is no TDS on NCDs held in dematerialized form.

Q 14: Can minor invest in this NCD issue?

Answer: Yes. Minor can invest through guardian in offline application mode.

Q 15: Are NRIs allowed to invest in these NCDs?

Answer: No.

Q 16: How to apply in TCFSL NCDs online through ICICIdirect.com?

Answer: To apply online, login to your ICICIdirect.com trading a/c and click on IPO or
FD/Bonds section.

Q 17: Can one customer place multiple orders from the same a/c online?

Answer: No. Multiple orders from the same a/c is not allowed.

Q 18: Can I modify / cancel the already placed online order?

Answer: Modification / cancelation of the online order is not allowed.

Q 19: By when these NCDs would be allotted an available for trading?

Answer: TCFSL shall ensure that all steps for the completion of the necessary formalities for
listing and commencement of trading at the Stock Exchange are taken within 12 Working
Days from the Issue Closing Date.
Q 20: Can I apply in ASBA (Application Supported by Blocked Amount) mode?

Answer: ASBA application mode is only available in offline mode. In Online, all applications
would be in Non-ASBA mode only i.e. amount will be deducted from the linked bank a/c.

Q 21: What is the interest on application & interest on refund amount, if not allotted?

Answer: TCFSL shall pay interest at the rate of the respective applicable coupon rate for the
Options of NCDs allotted to investors, on the Application Amount against which NCDs are
allotted to the Applicants, subject to deduction of income tax under the provisions of the
Income Tax Act, 1961, as amended, as applicable, from the date of realization of the
cheque(s) / demand draft(s) upto one day prior to the Deemed Date of Allotment.

TCFSL shall pay interest at the rate of 6% per annum, on the Application Amount on all valid
Applications, which is liable to be refunded to the Applicants (other than Application
Amounts received after the Issue Closing Date) pursuant to the Tranche I Prospectus,
subject to deduction of income tax under the provisions of the Income Tax Act, 1961, as
amended, as applicable, to the Applicants whose valid Applications receive (i) partial
allotment due to oversubscription or (ii) no allotment due to oversubscription pursuant to
the Tranche I Issue from the date of realization of the cheque(s) / demand draft(s) upto one
day prior to the Deemed Date of Allotment. In the event that such date of realization of the
cheque(s) / demand draft(s) is not ascertainable in terms of banking records, TCFSL shall
pay interest on Application Amounts on the amount Allotted from three Working Days from
the date of upload of each Application on the electronic Application platform of the Stock
Exchanges upto one day prior to the Deemed Date of Allotment. Such interest shall be paid
along with the monies liable to be refunded.

Interest on application / refund is not applicable in ASBA mode.

Q 22: Who is the Registrar to this issue?

Answer: The registrar is Karvy Computershare Private Limited.

Address & contact details:

KARVY COMPUTERSHARE PRIVATE LIMITED

Karvy Selenium Tower B, Plot 31-32, Gachibowli Financial District,
Nanakramguda, Hyderabad 500 032.
Tel: +91 40 6716 2222; Fax: +91 40 2343 1551; Email: [email protected];
Investor Grievance Email: [email protected];
Website: https://karisma.karvy.com; Contact Person: Mr. M Murali Krishna
SEBI Regn. Number: INR000000221