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G. Madhan

THE fixed deposit programme of Sundaram Home Finance (SHFL) is open for investment. The rates are higher than that offered by HDFC and CanFin Homes. The company's fundamentals are strong. Being a housing finance company, the interest income from the deposits is also eligible for a tax break under Section 80 L. Hence, an investment up to three years can be considered. Longer tenures, however, can be avoided. Schemes and features: SHFL offers cumulative and non-cumulative schemes. Under the latter, monthly, quarterly and annual income plans are on offered. The monthly income plan is available only for 36 months and beyond.

The interest rates (see table) for the non-cumulative annual scheme and the cumulative scheme are the same. However, the yields for the cumulative scheme are 6.25 per cent (one year), 6.71 per cent (two years) and 7.22 per cent (three years) as the interest is compounded annually. Further details can be got from the registered office at 21, Patullos Road, Chennai-600002.

Business prospects: The company disbursements in 2002-03 rose 53 per cent to Rs 236.3 crore over the previous year.

Given the robust demand for dwelling units, low interest rates and the various tax waivers offered by the Government, the company has good prospects for growth, as far as disbursements go. However, this may not necessarily lead to an improvement in the earnings, given the intense competition in this segment.

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