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Informist, Wednesday, Jan. 29, 2025

By Vaishali Tyagi

MUMBAI – Yields on corporate bonds in the secondary market ended steady on Wednesday due to lack of fresh domestic and global triggers, dealers said. "The market remained moderate today (Wednesday) as most traders are slightly cautious ahead of the budget (Union Budget for 2025-26 (Apr-Mar)) due Saturday... and there is no event as such to guide the market, even g-sec were steady today (Wednesday)," a mutual fund manager at a mid-sized mutual fund house said. 

The corporate bond market witnessed a slight improvement in trading volume today. However, the demand and supply dynamics remained balanced, resulting in no change in yields, dealers said.

On Wednesday, deals aggregating to INR 104.34 billion were recorded on the National Stock Exchange and BSE combined, compared with INR 99.09 billion on Tuesday. Banks were seen active on both buying and selling sides, dealing in papers maturing in short-tenures, dealers said. 

However, mutual funds were actively selling paper, while a few insurance companies bought shorter-term bonds, dealers said. "There was hardly any substantial activity apart from the regular need-based trading which could have any impact on yield levels," a dealer at a mid-sized brokerage firm said.

Papers issued by REC, Indian Railway Finance Corp., Telangana State Industrial Infrastructure Corp., Bajaj Housing Finance, Export Import Bank of India, National Housing Bank, and Adani Energy Solutions, were traded the most on exchanges on Wednesday. 

On Wednesday, several market participants kept an eye on National Highways Infra Trust's two bond issuances. The infrastructure investment trust of the National Highways Authority of India had planned to raise INR 31.2 billion through two bonds of different maturities. However, the trust raised only INR 20.32 billion at a yield of 7.75% on its zero-coupon bonds maturing on Jan. 30, 2035. Its Jan. 30, 2042 bond was scrapped, from which it planned to raise INR 10.70 billion.  

According to the bid book accessed by Informist, the issue with Jan. 30, 2035 maturity garnered 46 bids aggregating to INR 23.80 billion. "National Highways Infra Trust's did not receive the bids as expected, and they could only raise 20.31 billion via Jan 2035 bond, while they withdrew their another bond (Jan. 30, 2042)," the broker quoted above said. "Infact, NHIT's (National Highways Infra Trust's) raised funds through Jan. 30, 2035 at higher rate compared to what market was expecting."

Market participants now await the upcoming budget announcement, which is expected to provide clarity on the fiscal policy and its impact on the financial markets.  

UDAY BONDS

In the secondary market, Ujwal DISCOM Assurance Yojana bonds aggregating INR 91.50 million were traded at a weighted average yield of 7.2200-7.3502%, data from the Reserve Bank of India's Negotiated Dealing System–Order Matching System showed on Tuesday.

* INR 35.50 million of Tamil Nadu's March 2025 and March 2026 bonds were traded at 7.2200-7.3502% 

* INR 35.00 million of Rajasthan's March 2026 and June 2026 bonds were traded at 7.2200%

* INR 21.00 million of Telangana's March 2025 bonds were traded at 7.3501%

BENCHMARK LEVELS FOR CORPORATE BONDS:

End

Edited by Deepshikha Bhardwaj

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