Access equity and debt in one product
What are Market Linked Debentures?
Market Linked Debentures (MLDs) are also known as structured products. They are aimed at providing targeted ROI/Payoff to investors.
It combines debt instruments with market-linked returns.
The returns are dependent on the performance of the underlying market benchmark selected by the issuer of the MLD, such as Nifty 50, Nifty 100, or 10-Year G-Sec.
MLDs can be structured to offer principal protection, making them an ideal choice for investors looking to balance safety with growth potential.
In India, recent RBI guidelines have allowed such issuance for even INR 1 lakh – versus the INR 10 lakh limit earlier
Types of MLDs
Principal-Protected vs Non-Principal Protected MLDs
Your capital is 100% protected at maturity, with no downside risk irrespective of benchmark performance.
Completely linked to benchmark performance, offers higher participation in market gains or losses with no principal protection.
Income vs
Growth MLDs
Growth MLDs
Provide fixed coupon payments while participating in market upside.
May not have fixed income but have higher participation / upsides.
Why Invest in MLDs
Potentially outperform traditional fixed-income investments by capturing equity-linked returns
Enjoy a safety net with minimum return floors
Taxed at marginal tax rate irrespective of holding period
Tailored to meet specific risk and return goals
Easy risk assessment through clear credit ratings
Who Should Invest in MLDs?
MLDs offer a lower-risk entry into equity markets, with the option of principal protection.
Ideal for those unsure about market performance but still seeking upside potential with capital safety.
MLDs offer a great alternative to traditional fixed-income while diversifying from equities.
Our MLD Solutions
Our experts analyse and curate a selection of the top
MLDs from the industry to ensure you get only the best.
Our experts analyse and curate a selection of the top MLDs from the industry to ensure you get only the best.
Explore Custom
MLDs With PL
Structured Products are highly flexible and can be offered as Principal Protected or Non-Principal Protected investment options. Given their flexible structure, MLDs are a more attractive way to invest in an asset class as compared to traditional instruments. They can also be more tax efficient.
It gives investors the flexibility to select a customised payoff from the specified underlying asset class, as per the risk / return objectives.
We offer various MLD options for investors across asset classes, in addition to equity-linked structures. The debentures are held in the investor’s demat account.
HNI clients may often have large holdings in a stock that’s not expected to move much. We can create a custom structure for such clients wherein
If the stock moves up from current levels, they earn say 1.5x of the return
If the stock moves down, their principal is protected
In the event of a sharp market fall, you can buy back the same stock with the principal redeemed fully.
For more information, please write to us
advisorydesk@plindia.com
Key Features of MLDs
INR 1 lakh for standard MLDs, and typically INR 3 crores for custom-structured MLD portfolios.
MLDs are credited to your demat account within 10 days of subscription.
Your returns are linked to the performance of the underlying market index and paid at maturity after deducting applicable taxes.
MLDs are taxed at marginal tax rate irrespective of holding period under Sec 50AA of Income Tax Act
Select an asset class within the portfolio where downside protection is desired
Reallocate a portion of the asset class to a selected MLD
Improve
Potential risk / reward performance
FAQs on Market Linked Debentures (MLDs)
Market Linked Debentures (MLDs) are also known as structured products. They are aimed at providing targeted ROI/Payoff to investors.
It combines debt instruments with market-linked returns.
The returns are dependent on the performance of the underlying market benchmark selected by the issuer of the MLD, such as Nifty 50, Nifty 100, or 10-Year G-Sec.
MLDs can be structured to offer principal protection, making them an ideal choice for investors looking to balance safety with growth potential.
In India, recent RBI guidelines have allowed such issuance for even INR 1 lakh – versus the INR 10 lakh limit earlier.
A Market Linked Debenture (MLD) is a debt instrument where returns depend on the performance of an underlying index, such as an equity index or interest rate. Here’s a quick overview of how it works:
- Structure: You lend money to the issuer, and your returns are linked to a financial benchmark.
- Returns: At maturity, your payout is based on how the benchmark performed. If it performed well, you earn positive returns; if not, returns could be lower or zero.
- Risk & Tax Benefits: MLDs often offer capital protection and, if held for over a year, can be eligible for long-term capital gains tax, making them tax-efficient compared to traditional debt instruments.
MLDs provide market-linked growth potential with capital protection, suitable for those looking to diversify with some market exposure.
The minimum investment for off-the-shelf MLDs starts at INR 1 lakh. For custom-structured MLDs, the minimum investment is usually INR 3 crores.
Yes, MLDs are suitable for first-time investors who want market participation but prefer the safety of principal protection.
Already an existing client?
