HDFC delays the sale of Sukuk

The Housing Development Finance Corporation (HDFC) has delayed the sale of "Sukuk", Islamic equivalent of bonds, structured in such a way as to generate returns to investors without infringing Islamic law that prohibits interest.

While HDFC has previously sold "Sukuk", they announced the prospects for a second round of sales in July. The company was initially set to begin sales on 6 August 2017. Since then, the date has been pushed back to 24 August.

The Manager of the HDFC Islamic Window, HDFC Amnaa, Azmeen Rasheed told Sun Media that they had to delay the issuing of Sukuk because the sale cannot take place before 14 after the company is registered at the stock market.

The sale of Sukuk will be held from 24 August to 18 October 2017 according to the HDFC.

HDFC aims to get a revenue of MVR 150 million by selling 150,000 Sukuk at a rate of MVR 1,000 each.

The finance is to be used to provide facilities through the HDFC Amnaa.

Buyers will receive 65 percent of the profit while the HDFC will be taking 35 percent which will be distributed every six months.

The maturity of the Sukuk will be ten years meaning the buyers will be getting their full return in ten years.