HUDCO receives approval to issue capital gains bonds under Section 54EC
According to the notification, bonds issued by HUDCO may be redeemed after five years.
With the approval granting of the state-run company to issue capital gains bonds under Section 54EC for infrastructure financing, shares of Housing & Urban Development Corporation Ltd. (HUDCO) will be in focus on Wednesday, April 9.
Regarding the bond issuance by HUDCO after April 1, 2025, the beginning of the new fiscal year, the notification was released by India's Finance Ministry.
According to the notification, bonds issued by HUDCO may be redeemed after five years. Only infrastructure projects that can pay off debt with project revenues and that HUDCO cannot rely on state governments to do so are eligible to receive proceeds from these bonds.
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Any long-term capital gains (LTCG) from the sale of real estate, including homes and land, are exempt under Section 54EC of the Income Tax Act if the proceeds are invested in PSUs listed under the Section. These exemptions currently apply to bonds issued by state-run businesses like Rural Electrification Corp. Ltd. (REC) and Power Finance Corp. (PFC).
Shares of HUDCO are trading higher by 1.25% at Rs 209.59 at NSE.
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