Preference Shares - OCC 3.93% NCPS 10

After a lull period of 8 months, I am back to look at Preference Shares which I am thinking of placing some cash into it. Here is one which I am considering seriously

• Current Price = $97.80
• Interest = $3.93 per share
• Yield = 4.02%

Investment till Callable Date

• Tenure = 3 years
• Total Interest = $11.79
• Capital Appreciation = $2.20
• Overall Yield = 4.77%

This is one preference shares which I am considering because it is the only one which is trading at a discount to Par Value. However, the catch is that if it is not recalled, the interest will drop to SOR + 1.85% which is quite low at 2.3% currently. Thus, I think they will not recall it and continue to pay interest to this. Nevertheless, it is still slightly better than a bond.