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Informist, Friday, Feb. 28, 2025

By Ashna Mariam George 

MUMBAI – Yields on corporate bonds in the secondary market wrapped up the week on a steady note after rising 3-7 basis points on Thursday as India's GDP growth came largely along expectations and failed to impact the levels, dealers said. 

India's GDP growth rose to 6.2% in Oct-Dec from 5.6% in Jul-Sept due to a better performance by the manufacturing and agriculture sectors, data released by the statistics ministry Friday showed. According to an Informist poll, GDP growth was seen rising to 6.3%.

"The levels are in a steady territory even after the GDP data...now there are no major triggers for markets to rally," a fund manager at a mid-sized mutual fund house said. "The spreads (between yields on corporate bonds and government securities) are up because there is constant supply (of bonds in the primary market), and liquidity continues to be a problem...the primary levels are also coming at higher levels."

The spread between 10-year benchmark National Bank for Agriculture and Rural Development paper and 10-year g-sec was 52 bps Friday, compared to 48 bps Thursday. Spreads widened as the higher-than-expected cut-off on bonds issued by marquee issuers in the primary market, pushed up yields on corporate bonds in the secondary market Thursday. 

In the secondary market Friday, deals aggregating to INR 79.34 billion were recorded on the National Stock Exchange and BSE combined, compared with INR 115.08 billion at the same time Thursday. Only a few banks were active on the buying and selling sides, while mutual funds, insurance companies, and pension funds remained largely on sidelines, dealers said. 

Papers issued by REC, HDFC Bank, LIC Housing Finance, Power Finance Corp., Telangana State Industrial Infrastructure Corp., National Bank For Agriculture And Rural Development, Bharti Telecom, HDB Financial Services, and Aditya Birla Housing Finance were traded the most on exchanges.

The primary market of corporate bonds saw limited activity compared to Thursday. Aditya Birla Finance raised INR 7 billion through reissuance of its bonds maturing on Jul. 13, 2028 at a yield of 7.96%. 

On Monday, several private entities are lined up to tap the market with their respective bond offernings. LIC Housing Finance Ltd. plans to raise up to INR 14 billion through reissuance of its bond maturing on Oct. 22, 2027. Capital Infra Trust will tap the market on Monday to to raise INR 11.63 billion through bonds maturing on Jan. 29, 2038. 

Can Fin Homes has invited bids on Monday to raise up to INR 10 billion through bonds maturing on Jan. 4, 2027. 360 One Prime also plans to raise up to INR 6 billion through bonds maturing in two years. 

UDAY BONDS

In the secondary market, Ujwal DISCOM Assurance Yojana bonds aggregating INR 289.00 million were traded at a weighted average yield of 6.9000-7.1465%, data from the Reserve Bank of India's Negotiated Dealing System–Order Matching System showed Monday.

* INR 250.00 million of Haryana's Jun. 15, 2026 bonds were traded at 6.9000%

* INR 39.00 million of Rajasthan's Jun. 23, 2026 bonds were traded at 7.1465%

BENCHMARK LEVELS FOR CORPORATE BONDS:

End

Edited by Deepshikha Bhardwaj

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