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Informist, Monday, Sep 2, 2024

By Richard Fargose

MUMBAI – Fundraising through commercial papers and certificates of deposits surged today as companies and banks tapped the market to refinance the maturing papers, dealers said.

So far today, CPs worth 110.75 bln rupees have been issued, compared with 5.75 bln rupees issued Friday. Of the total, National Bank or Agriculture and Rural Development raised 35.00 bln rupees through three-month papers at 7.24%. Followed by Export and Import Bank of India, which raised 25 bln rupees through CPs maturing in three months at 7.23%. Market participants said the company tapped the market to roll over papers set to mature in the coming days.

National Bank for Agriculture and Rural Development has CPs worth 211.75 bln rupees that are due to mature this month, of which CPs worth 71.75 bln rupees are to mature this week. Similarly, EXIM Bank have 75-bln-rupee worth of CPs due for maturity this month.

"After a subdued activity in the last week, primary market was super active today," said a dealer with a brokerage firm.

A couple of banks also raised funds to roll over maturing papers. Banks raised CDs worth 45.25 bln rupees today, as against 28.00 bln rupees on Friday.

Bank of India raised 20.75 bln rupees through 6-month CDs at 7.55%, and Canara Bank raised 21.50 bln rupees through three-month papers at 7.16%, and 3 bln rupees through six-month papers at 7.49%.

Market participants said both the banks raised funds to refinance the maturing CDs. Bank of India has CDs worth 46.50 bln rupees due for maturity this week, while CDs worth 20.50 bln rupees of Canara Bank are scheduled for redemption later this week.

Despite the surge in issuances, rates were steady as these papers were easily absorbed by mutual funds demand, dealers said.

Rates on three-month CPs issued by non-banking finance companies were steady at 7.60-7.65%, and those on papers of similar maturities issued by manufacturing companies were unchanged at 7.25-7.30%. Rates on CDs maturing in three months were at 7.20-7.25%.

--Primary market

* National Bank for Agriculture and Rural Development, Export and Import Bank of India, Reliance Jio Infocomm, ICICI Securities, Bajaj Financial Securities, Tata Capital Housing Finance, HDFC Securities, Godrej Industries, Aditya Birla Finance Ltd, Aditya Birla Money, Godrej Finance, Aditya Birla Finance Ltd, and Tata Power Co raised funds through CPs

* Bank of India and Canara Bank raised funds via CDs.

--Secondary market

* Indian Bank's CD maturing on Tuesday was dealt 10 times at a weighted average yield of 6.3828%.

* National Bank for Agriculture and Rural Development's CP maturing on Tuesday was dealt eight times at a weighted average yield of 6.3779%.

At 1700 IST, the following were the volumes, in bln rupees, in the secondary market for the short-term debt, as detailed by the Clearing Corp of India's F-TRAC platform:

End

Edited by Akul Nishant Akhoury

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