Company Profile: Bondskart (SEBI Registered OBPP)

KEY TAKEAWAYS

1. Indian bonds have been gaining global recognition, with inclusion in major indices like JP Morgan, Bloomberg, and FTSE Russell.

2. Bondskart, an investment platform for various bonds, is one of the initial players in India to obtain the OBPP license from SEBI, and is registered with both NSE and BSE.

3. Bondskart operates under JM Financial Services Limited, a leading financial services group in India, leveraging its strong connections to offer competitive bond prices.

4. The platform offers a curated collection of premium-grade bonds, focusing on minimizing default risks, and provides specific investment options for NRIs.

5. Despite its strengths, Bondskart faces challenges, such as regulatory issues with its parent company, JM Financial, and the industry-wide issue of using IRR for bond opportunities, which can be misleading.

Do you remember the game-changing announcements of Indian bonds getting included in JP Morgan and Bloomberg indices? Well, another big news has again put the spotlight on Indian bond market, which has been unlocking its potentially globally. After JP Morgan and Bloomberg, Indian bonds will soon be included in a third global index, known as FTSE Russell, from September 2025. For the unversed, FTSE Russell is a subsidiary of the London Stock Exchange (LSE) group.

Until about a year ago, not a single global index had announced the inclusion of Indian bonds. Fast forward to today, Indian bonds have either already been, or will soon be included in three global indices-JP Morgan (announced in September 2023), Bloomberg (announced in March 2024) and FTSE Russell (announced in October 2024).

This wide acceptance and inclusion of Indian bonds in global indices is expected to bring in billions of dollars of foreign inflow as investment. Even for retail investors, SEBI’s big move in April earlier this year to reduce the face value of corporate bonds from ₹1 lakh to ₹10,000 has made the listed bond market more accessible for retail investors like you and me.

With India’s bond market finally beginning to unleash its potential and strength, let us bring to you the journey of Bondskart, one of the initial players in India to get the OBPP license from SEBI. It is registered with both NSE and BSE.

If you want to know more about OBPPs and the list of OBPP players in India, check out our detailed blog. Click here.

Corporate Structure of Bondskart

Bondskart is an investment platform for a wide range of bonds, including private and public sector bonds, NBFC bonds, capital gain scheme bonds, and much more.

Soon after the launch of OBPP regulations by RBI in November 2022, Bondskart was among the initial players in the market to obtain OBPP license.

Bondskart is registered under the established brand name of JM Financial Services Limited, which was incorporated in 1998. JM Financial is one of the leading and biggest financial services groups in India. In 2019, an institutional fixed income division for JM Financial was set up, and subsequently Bondskart came into force.

Parent Company Of Bondskart Brand

Founded more than 50 years ago, JM Financial Group forayed into the financial sector services as JM Financial & Investment Consultancy Services Pvt. Ltd. (JMFICS) in Mumbai in 1973. The group was founded by veteran investment banker, Nimesh Kampani.

JM Financial has a major financial footprint in the Indian fixed income market. They source investment opportunities through Investment Banking, Equity Brokerage, PMS & many other wealth creation services. Being a wholly owned subsidiary of it, these ties with large corporates and other ecosystem players assist Bondskart in sourcing debt deals for its platform.

As per MCA data (checked on 15th October), JM Financial Services Ltd (JMFSL) has a total of 10 directors.

Business Model of Bondskart

Just like most SEBI-registered OBPPs in India, the business model of Bondskart revolves around being a distributor of bonds and earning a spread i.e. they buy at a lower price and sell at a higher price.

Here’s a list of the investment products being offered on Bondskart platform:

1. Capital Gain Scheme Bonds (Read about them here)

2. NRI Eligible Bonds

3. Public Sector Undertaking Bonds

4. Ultra Short Term Bonds

5. Ongoing IPOs

6. Short Term Investment Bonds

7. Long Term Investment Bonds

8. Private Sector Bonds

9. Sovereign Bonds

10. Tax Free Bonds

11. Public Sector Bank Bonds

12. Securitized Debt Instruments

    

    Due to their strong connections with the JM Financial Group, Bondskart is well-positioned to offer competitive prices on bonds while still making a decent profit on the spread. However, like any other business in finance, success largely depends on volume. The more you sell, the more you earn! Bondskart claims to have more than Rs 10,000 crore worth of bonds available on its platform everyday.

    Also, JM Financial Services Ltd claims to have more than Rs 30,000 crore of AUM, and over 3.28 lakh clients.

Can Defaults Happen?

Debt instruments in nature are less riskier than equity investments, but it highly depends on which kind of bond you have purchased. Now with so many options available in the market such as NCD, MLD, Unlisted Corporate, Govt Bond, it can get very confusing on which option works best for you. But one thing which is always very helpful to know is the rating of the bond.

Things We Like About Bondskart

• NRI-specific investment option - If you are an NRI, Bondskart offers a selection of bonds that are specifically open for you to invest in. There don’t seem to be many platforms offering this filter or opportunities in this space.

• SEBI regulated platform - Bondskart is a SEBI Registered OBPP. It is registered with both NSE and BSE, and thus comes under the umbrella of all of SEBI’s guidelines and regulations.

• Strong leadership & lineage - Bondskart is backed by one of India’s most leading financial services companies, JM Financial. Moreover, key members in its leadership team have a rich experience in capital markets, stock broking, and wealth management fields.

• Curated collection of premium grade bonds-Bondskart claims to host nearly 80 premium grade bonds on its platform, ranging from AA to AAA ratings. Bonds having ratings below these don’t seem to be available on the platform. This is the platform’s attempt to eliminate, or at least minimize the possibility of defaulters.

  Things We Don't Like About BondsKart

• JM Financial Group has faced serious trouble with SEBI this year. Earlier this year in March 2024, SEBI barred JM Financial from acting as a lead manager for the issue of new public debt, for promising guaranteed returns to investors, till March 2025.

• All opportunities by Bondskart are shown in IRR (Internal Rate of Return), which can be misleading for bonds because it assumes all interest payments are reinvested at the same rate. This isn't always true, as TDS payments are deducted and cannot be reinvested at the same rate. However, this is an industry-wide issue and not specific to Bondskart alone.

• While credit ratings are a useful metric for assessing a bond's risk for retail investors, it would be helpful if Bondskart showed the average default rate for that credit rating across the Indian debt markets. This information is regularly published by credit rating agencies and would give retail investors a better understanding of the default history for that rating.

Conclusion

In conclusion, it’s fair to say that Bondskart is among the significant players in the Indian bond market, especially leveraging its strong ties with JM Financial group. While the platform's focus on offering a wide variety of premium-grade bonds can and its SEBI registration do provide a level of trust and security for investors, the recent regulatory bans faced by JM Financial Group are something investors should be aware of. Nonetheless, as the Indian bond market continues to grow and gain global recognition, platforms like Bondskart will be aiming to capitalize on this momentum by offering both retail and institutional investors opportunities to take a piece of this bond market pie into their portfolio.

Please note that this is an opinion blog and not an official research or investment advice. This blog aims to help retail investors make an informed decision in the bond market, and neither encourages nor discourages you from investing in any particular bond or any other asset class.

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