India Corporate Bonds
Yields steady as market lacks triggers; volume dn
This story was originally published at 21:19 IST on 15 October 2024
Register to read our real-time news.Informist, Tuesday, Oct. 15, 2024
MUMBAI – Lack of major triggers and low trading volumes kept yields steady on corporate bonds in the secondary market Tuesday, dealers said. "We did not see much activity in the market today (Tuesday) as there were no fresh triggers," a dealer at a mid-sized brokerage said. "Participants were there, and buying and selling from banks and mutual funds were seen, but it did not affect the yield levels."
Banks were mostly on the buying side, while mutual funds were seen selling paper, dealers said. However, the buying and selling were in small amounts, without a significant effect on yields. Most of the deals were struck at the shorter end of the curve. A handful of insurance companies were active, but not with significant deals, in longer tenure paper, dealers said.
Some dealers said a few mutual funds sold government bonds and bought corporate bonds to maximise their profits. "I heard that mutual funds were selling gilts (government bonds) today (Tuesday), and they bought corporate bonds in return," a fund manager at a mid-sized mutual fund house said.
Trade volume remained subdued in the secondary market with deals aggregating to only INR 71.96 billion recorded on the National Stock Exchange and BSE combined, against INR 71.47 billion Monday.
Paper issued by REC Ltd., HDFC Bank Ltd., Data Infrastructure Trust, LIC Housing Finance Ltd., National Bank for Agriculture and Rural Development, National Housing Bank, Kerala Infrastructure Investment Fund Board, HDB Financial Services, Mahindra & Mahindra Financial Services Ltd., and Power Finance Corp. Ltd. were traded the most on exchanges.
Primary market activity picked up Tuesday with companies and financial institutions raising over INR 67 billion through their respective issuances. Mankind Pharma raised INR 50 billion through three bonds with different maturities. All the bonds, which carry fixed coupons payable semi-annually, were fully subscribed.
Tata Capital Housing Finance Ltd. also tapped the debt market to raise INR 11.76 billion through bonds maturing on Jan. 14, 2028, at a fixed coupon of 7.712%. Tata Capital Ltd. raised INR 6.1 billion through reissuance of its Sept. 2027 bonds at a yield of 7.82%.
On Wednesday, Bajaj Housing Finance Ltd. plans to raise up to INR 15 billion through bonds maturing in five years. 360 One Prime is also in queue to raise up to INR 2.5 billion through May 2027 bonds. Other than these major issuers, Rajkot Municipal Corp., IKF Finance, Akara Capital Advisors, and Electronica Finance will also seek bids for their respective bond offerings.
UDAY BONDS
In the secondary market, Ujwal DISCOM Assurance Yojana bonds aggregating to INR 24.50 million were traded at a weighted average yield of 6.7647%-7.1743%, data from the Reserve Bank of India's Negotiated Dealing System–Order Matching System showed.
* INR 20.00 million of Bihar's March 2027 bonds were traded at 7.1743%
* INR 4.50 million of Punjab's March 2026 bonds were traded at 6.7647%
BENCHMARK LEVELS FOR CORPORATE BONDS:
TENURE | TUESDAY | MONDAY |
Three-year | 7.41-7.43% | 7.40-7.43% |
Five-year | 7.32-7.35% | 7.33-7.35% |
10-year | 7.21-7.23% | 7.20-7.23% |
End
Edited by Rajeev Pai
For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.
Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.
Informist Media Tel +91 (22) 6985-4000
Send comments to feedback@informistmedia.com
© Informist Media Pvt. Ltd. 2024. All rights reserved.
To read more please subscribe
Share this Story:
