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Informist, Tuesday, Mar. 25, 2025

By Kabir Sharma

MUMBAI – Issuances in the short-term debt market fell on Tuesday as market participants expect rates to come down in the next financial year, starting April, dealers said. "Right now traders just want to issue enough to meet their rollover needs as everyone is expecting the rates to ease in the upcoming months. It seems a better strategy to wait till mid-April and then raise funds rather than locking in the higher rates for now," a dealer at a private bank said.

Issuances of certificates of deposit fell to INR 28.50 billion, from INR 31.50 billion on Monday. Small Industries Development Bank of India borrowed funds for the second consecutive day, raising INR 14.00 billion via a one-year paper at 7.40%. SIDBI was also the largest CD issuer on Monday, raising INR 21.00 billion through a one-year paper at 7.41%. 

Bank of India was the sole bank in the market raising INR 14.50 billion via a three-month paper at 7.44%. "Banks will not be so active until April, as most of their funding needs are met by now," a dealer at a brokerage firm said. 

In commercial papers, a total of INR 25.50 billion was raised on Tuesday, sharply lower than INR 53.25 billion raised on Monday. Power Finance Corporation was the largest issuer raising INR 15.00 billion via a short-term paper maturing in mid-April. 

Godrej Consumer Product raised INR 4.00 billion via a one-month paper and INR 4.00 billion via a two-month paper. However, the paper which was for two-months was issued 12 basis points higher than the one-month paper at 7.57%.

--Primary market

* Power Finance Corporation, Godrej Consumer Product, ICICI Securities, Tata Capital raised funds via CPs.

* Bank of India and Small Industries Development Bank of India raised funds via CDs.

--Secondary market

* Bank of Baroda's CD maturing on Mar. 11, 2026 was traded five times at a weighted average yield of 7.3500%.

* Reliance Indutries' CP maturing on Wednesday was traded four times at a weighted average yield of 6.4089%

The following were the volumes, in INR billion, in the secondary market for short-term debt at 1700 IST, as detailed by the Clearing Corp. of India's F-TRAC platform:

End

Edited by Deepshikha Bhardwaj

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