India Corporate Bonds
Yields remain steady ahead of year-end; volume low
This story was originally published at 19:31 IST on 30 December 2024
Register to read our real-time news.Informist, Monday, Dec. 30, 2024
By Sachi Pandey
MUMBAI – The corporate bond market witnessed a lacklustre Monday, with yields remaining steady as market participants refrained from making large bets ahead of the year-end. The holiday season has led to a significant slowdown in market activity, with many investors and bankers taking an extended break.
"Activity in the market is dead right now," said a dealer at a mid-sized insurance company. "Since New Year's and Christmas fall on weekdays everyone has taken a long week off. Maybe we'll see some life in the market after 2-3 days."
On Monday, investor participation also remained low with foreign institutional investors and bankers on holiday ahead of the New Year, resulting in subdued trade volumes. Volume in the secondary market remained lacklustre. Deals aggregating to INR 83.92 billion were recorded on the National Stock Exchange and BSE combined, as against INR 108.99 billion on Friday.
In the secondary market today, only a few mutual funds were said to be active for requirement-based trading, dealers said. Mutual funds have largely been active on the selling side this week to meet their redemption requirements for the quarter-end and year-end.
Bonds issued by Renew Wind Energy, National Bank For Agriculture And Rural Development, Power Finance Corp., Housing And Urban Development Corp., Rural Electrification Corp., Shriram Finance, Kerala Infrastructure Investment Fund Board, Small Industries Development Bank of India were traded the most across tenures.
Activity in the primary market was also thin as there were no significant cues for investors due to the holiday season. LIC Housing Finance raised INR 16.35 billion by reissuing bonds maturing on Oct. 18, 2029, at a yield of 7.68%.
Merchant bankers expect the primary market to remain dull for another week before picking up momentum. "The primary market will also remain dull for one more week," said a fund manager at a large-sized insurance company. "After that, issuers will start coming in, and we will see a lot of momentum then. It is the last quarter, and it's usually a bond-heavy quarter, so we expect many public sector entities to tap the market for their funding requirements."
UDAY BONDS
In the secondary market, Ujwal DISCOM Assurance Yojana bonds aggregating to INR 335.00 million were traded at a weighted average yield of 7.0063-7.0750%, data from the Reserve Bank of India's Negotiated Dealing System–Order Matching System showed on Monday.
* INR 320.00 million of Haryana's Mar. 31 bonds were traded at 7.0750%
* INR 15.00 million of Feb. 22 bonds were traded at 7.0063%
BENCHMARK LEVELS FOR CORPORATE BONDS:
TENURE | MONDAY | FRIDAY |
Three-year | 7.54-7.56% | 7.56-7.59% |
Five-year | 7.48-7.50% | 7.48-7.50% |
10-year | 7.22-7.25% | 7.23-7.26% |
End
Edited by Saji George Titus
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:
