More Stories

Informist, Thursday, Jan. 23, 2025

By Vaishali Tyagi

MUMBAI – Yields on corporate bonds remained in a narrow range in the secondary market on Thursday, as most participants focused on the activity in the primary market, dealers said. "I would say, it was a slightly hectic day with demand for papers in shorter tenures, but supply matched the demand, therefore no impact on yields was seen," a dealer at a mid-sized brokerage firm said. "Primary market was quite active today (Thursday) with a few state-owned backed entities, and we expect the effect of primary market momentum will be seen into the secondary market soon."

On Thursday, deals aggregating to INR 84.61 billion were recorded on the National Stock Exchange and BSE combined, as compared to INR 83.56 billion on Wednesday. Mutual funds were both on the buying and selling sides, dealing in papers of maturities up to three years. A handful of banks and insurance companies were seen active on the buying side, dealers said. Most of the activity was concentrated in the shorter end of the curve, they added. 

Papers issued by Rural Electrification Corp., LIC Housing Finance, Power Finance Corp., Aditya Birla Housing Finance, Jamnagar Utilities & Power, National Bank for Agriculture and Rural Development, Indian Renewable Energy Development Agency Ltd. were traded the most on exchanges. 

The primary market, on the other hand, saw robust activity, with several state-owned entities tapping the market to cumulatively raise over INR 84 billion. National Housing Bank raised INR 34.80 billion through bonds maturing on Jul. 4, 2031 at a coupon of 7.29%. Another state-owned enterprise, Export-Import Bank of India, raised INR 25 billion through bonds maturing on Jul. 27, 2028, at a coupon of 7.35%. "EXIM Bank got decent bids, but the cut-off was higher than expected. We expected a coupon around 7.29-7.31%, at least 3-4 basis points lower," the dealer quoted above said. 

NHPC also tapped the market to raise INR 24.89 billion at a coupon of 7.20% through bonds maturing in 10 years. The issue marked the company's return to the corporate bond market after a hiatus of nearly two years. This is the company's first bond issuance in 2024-25 (Apr-Mar). The last time NHPC raised funds through the corporate bond market was in February 2023, when it raised INR 9.96 billion through bonds maturing in 15 years at a coupon of 7.59% 

Merchant bankers say the primary market of corporate bonds saw good demand for papers from state-owned entities, with NHPC and National Housing Bank receiving good bids. They said NHPC garnered significant interest from investors. According to the bid book accessed by Informist, the issue received 92 bids aggregating INR 86.69 billion in the range of 6.92-7.80% coupon. The market had expected the coupon to be in the range of 7.15% to 7.20%.

Dealers said investors showed strong appetite for top-rated state-owned papers even though the cut-offs were slightly higher than expected for the papers issued Thursday.

UDAY BONDS

In the secondary market, Ujwal DISCOM Assurance Yojana bonds aggregating INR 830 million were traded at a weighted average yield of 6.5505-7.1596%, data from the Reserve Bank of India's Negotiated Dealing System–Order Matching System showed on Thursday.

* INR 700.00 million of Rajasthan's Mar. 15, 2025 bonds were traded at 6.6356%

* INR 100.00 million of Tamil Nadu's Feb. 22, 2025 bonds were traded at 6.5505%

* INR 30.00 million of Punjab's Mar. 31, 2031 bonds were traded at 7.1596%

BENCHMARK LEVELS FOR CORPORATE BONDS:

End

Edited by Avishek Dutta

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. 2025. All rights reserved.