Re: fdr with corporate

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

11 June 2012 Please suggest that Fdr with corporates companies like JP Associates and Birla power are safe , which give rate of interest 12.5%

Are these fdrs are safe.

C.A Sandeep J Nambiar

C.A Sandeep J Nambiar (Expert)
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16 June 2012 Since the Interest Rates on these fixed deposits are high these deposits come with a higher risk - Default Risk. Since Bank Deposits are Secured by R.B.I ( Rs.1 Lac per Branch),bank deposits are safer as compared to company deposits which are unsecured . One has to study the Company Performance over a period of last 2-3 years, it's Financial Solvency, Liquidity Ratio.
One of the most reliable method of finding out whether a company fixed deposit is safe or not is by going through the Ratings provided by the Institutions like CRISIL, ICRA for that F.D. These Ratings are given after a lot of research. So, they can be considered Reliable . And also consider the Period of Deposits vis a vis requirement of money as these deposits take time to redeem as compared to bank deposits .

C.A Sandeep J Nambiar

C.A Sandeep J Nambiar (Expert)
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