The value of a convertible is the sum of the values of the straight bond component and the conversion option (equity component). The value of the straight bond component can be calculated by discounting the coupon (of the convert) at the prevailing yield on comparable straight bonds. An 8 percent, Rs 100 face value convertible has a tenor of 20 years. If the yield on comparable straight bonds is 9 percent, calculate the value of the bond component of the convertible.