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Informist, Friday, Sep 13, 2024

By Vaishali Tyagi and Ashna Mariam George

MUMBAI – Yields on corporate bonds in the secondary market remained limited to a narrow range today, with investors awaiting event-packed week ahead, including the US Federal Open Market Committee's meeting's outcome, dealers said. 

"As such, nothing noteworthy took place today, yet I would say a good number of participants were seen in the market ahead of the action-packed week," a dealer at a mid-sized brokerage firm said. "US FOMC is there for what people were waiting for, even though we know its impact is expected to be minimal, yet it will still provide a direction for to the Indian government securities and consequently to Indian corporate bond market."

Yields in the secondary market have seen slight movement due to buying and selling activities, tracking government securities, a dealer with a mid-sized brokerage firm said. "Currently, the market is not experiencing any kind of drag as supply is matching the demand, and yields remain unbothered," a fund manager at a mid-sized mutual fund house.

In the secondary market for corporate bonds, mutual funds, and banks were mainly active on both the buying and selling sides, and traded in papers maturing in the shorter tenure, dealers said. Insurance companies were also active in the longer-tenure paper, a fund manager at a mid-sized mutual fund house.

Today, deals aggregating to 91.58 bln rupees were recorded on the National Stock Exchange and BSE combined, compared with 99.42 bln rupees on Thursday.

Papers issued by the National Bank for Agriculture and Rural Development, HDFC Bank, LIC Housing Finance, Bajaj Finance, Muthoot Fincorp, Shriram Finance, Hella Infra Market, Spandana Sphoorty Financial, Navi Finserv, and AYE Finance, were traded the most on the exchanges.

In the primary market, there are several issues lined up for the coming week. Dealers said that market participants are looking forward to the State Bank of India's Basel-III compliant tier-II bond issuance on Wednesday. "Next week, several issues are lined up for the coming week in primary. Especially, traders will look for SBI's bond, let's see what it brings to the table," a dealer at a mid-sized brokerage firm said. 

State Bank of India plans to raise up to 75 bln rupees through 15-year tier-II bonds, with bidding scheduled for Wednesday on the National Stock Exchange's electronic platform. The issue has a base size of 40 bln rupees and a greenshoe option of 35 bln rupees, with a call option after 10 years from the allotment date.

On Monday, Cyqure India plans to raise 30 bln rupees through bond maturing on Mar 17, 2028. Sadbhav Gadag Highway will also tap the market to raise 900 mln rupees through maturing on Oct 31, 2028. 

Merchant bankers believe that several state-owned entities may tap the market next week along with non-banking financial companies including those of REC and Power Finance Corp.

UDAY BONDS

In the secondary market, 100 mln rupees of Uttar Pradesh's Ujwal DISCOM Assurance Yojana bond, maturing in March 2028, was traded at a weighted average yield of 7.0792%, data from the Reserve Bank of India's Negotiated Dealing System–Order Matching System showed.

BENCHMARK LEVELS FOR CORPORATE BONDS: 

End

Edited by Deepshikha Bhardwaj

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