Listed bonds are traded on a recognized stock exchange, offering liquidity and price transparency. Unlisted bonds, on the other hand, are not traded on exchanges and are often privately placed. For example, a listed bond like X company’s 3-year bond with a face value of ₹1L may be traded on the BSE, allowing investors to buy and sell it easily. In contrast, an unlisted bond issued by Y Company, also with a face value of ₹1L and a 3-year duration, may be available through private placements, limiting liquidity and market visibility. Investors should consider factors like risk, liquidity, and market access when choosing between listed and unlisted bonds.
Unlisted bonds or bonds available through private placement typically have a higher ticket size as compared to listed bonds. The ticket size for privately placed NCDs was reduced from INR 10 lakh to INR 1 lakh only in October 2022. While listed bonds can have a face value as low as INR 100.