I own IRB Invit since the last 1 year. I just sat down and calculated my returns from it in the last 1 year.
My purchase price for IRB was 74.
IRB gave 4 distributions in the last 1 year. Each distribution had 2 components - an interest component & a Return of Capital Component. The RoC is not taxable but the interest component is.
Over the year, distributed Rs. 8.60 as Interest for each unit of the InVIT. It also distributed Rs. 3.60 as RoC for each unit.
So at my buy price of 74 per unit, I got around 11.6% as interest (this is ignoring the RoC component of the distribution). However, the unit price is now 64, so if I were to sell, I would lose 10 Rs per unit, but since I got 3.60 as RoC, my actual loss would be Rs. 6.40 per unit.
For someone who buys it at a price of Rs. 64, assuming similar distribution in the coming year, he would get interest of 13.4% & also RoC. This is very good but overall whether it’s worth it or not, depends on how much the price goes down from here. If it goes down same as the RoC, then it’s great investment, but if it goes more, then it’s probably not.
So my main question is what is the prognosis on future trend of IRB InVIT?