Debt structured products are investment instruments that combine fixed-income securities (like bonds or debentures) with customized features such as capital protection, equity linkages, or performance-based payouts. These products are tailored to meet specific investor goals such as:
Regular income
Capital preservation
Market-linked returns with limited downside
They are often privately placed and targeted at HNIs or institutional investors.
These products typically involve:
A fixed-income component (e.g. non-convertible debentures or bonds) offering regular interest.
A derivative or equity-linked component to provide upside potential or protection.
Example: A product may guarantee 100% capital protection and link the return to the performance of Nifty 50 over 3 years
Some common types include:
Market-Linked Debentures (MLDs)
Capital-Protected Structured Notes
Equity-Linked Debentures
Fixed Maturity Plans with Structured Payouts
These are often issued by NBFCs, banks, or financial institutions and sold via private placement.
Minimum ticket sizes are usually high:
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Typically ₹10 lakhs or more depending on the issuer and product type.
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Most are available only to accredited or high-net-worth investors.
Always verify if the product is listed or unlisted and ensure SEBI-compliant documentation is provided
While they can offer protection or enhanced returns, risks include:
Issuer credit risk (risk of default)
Liquidity risk (may not be easily tradable)
Market risk if linked to equity or commodity indices
Complexity—terms may be hard to fully understand without financial expertise
It’s important to read the term sheet carefully and understand the payoff structure.