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Indian Stamp Act, 1899: A legal statute, which provides for the payment of stamp duty in case of all real estate transactions to duty to the local government. The value of the stamp duty depends on the rental payable and the lease term or the sale value as the case may be. This duty is paid by purchasing non judicial Indian Stamp Paper, on which the lease/sale agreements are documented.
Improvements: Generally, physical changes which enhance the capital value of land or buildings. These may include additional buildings, extensions to existing buildings, installation of new services, eg. central heating and air conditioning and infrastructure works. On the other hand, mere replacement by a modern equivalent if something worn out would normally be regarded as a repair rather than an improvement. The distinction has legal and taxation consequences.
Indenture: a deed between two or more parties, each party having his own copy. Originally copies were all included in a single document from which each part was torn or cut along a wavy (intended) line.
Institutional investors: These are generally taken to include banks, pension funds, insurance companies, unit trusts and investment trusts, which are together commonly referred to in the investment field as the “institutions”.
Investment yield: The annual percentage return which is considered to be for a specific valuation in an investment being expressed as the ratio of annual net income (actual or estimated) to the capital value. It is therefore a measure of an investor’s opinion about the prospects and risks attached to that investment. The better the prospects and lower the risks, the lower the expected yield and thus the greater the capital value. The required yield from an investment is estimated in the light of such factors as:
(a) the security in real terms of the capital invested.
(b) the security in real terms and regularity of income.
(c) the ability to adjust the income to reflect market conditions.
(d) the complexity and cost of management.
(e) the ease and likely cost of realizing the capital.
(f) the tax position.
Internal rate of return (IRR):(a) The rate of interest (expressed as a percentage) at which all-future cash flows (positive and negative) must be discounted in order that the net present value of those cash flows should be equal to zero. It is found by trial and error by applying present values at different rates of interest in turn to the net cash flow. It is something called the discounted cash flow rate of return. (b) An alternative explanation might be: the highest rate of interest ( expressed as a percentage) at which funded cash flow generated is to be sufficient to repay the original outlay at the end of the project life.