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Informist, Wednesday, Apr. 16, 2025

By Siddhi Chauhan

MUMBAI – Issuances in the commercial paper segment rose sharply Wednesday due to rollover and funding requirements, dealers said. CPs worth INR 109.00 billion were issued Wednesday, sharply up from INR 67.75 billion Tuesday. On the other hand, no certificates of deposit were raised for the third consecutive day.

On Wednesday, Bajaj Finance raised INR 10 billion through three-month paper at 6.70%. Including Wednesday's issuance, the non-banking finance company has raised just INR 13.50 billion in April against the maturity of INR 60.90 billion, as per data compiled by Informist. National Thermal Power Corp., which was the largest issuer Wednesday, raised INR 30 billion through an 11-month paper at 6.68%. 

"Many issuers like Bajaj Finance are raising funds because of upcoming maturity. They (Bajaj Finance) has a huge chunk of maturity coming up in this month," a dealer at a brokerage firm said. "However, there are some issuers who have fulfilled their rollover requirements but still are looking to raise funds. I don't think NTPC has maturity in this month, they are still raising funds because of some other requirement."

Rates on the three-month paper issued by non-banking finance companies were at 6.70-6.90%, slightly higher than 6.65-6.85% Tuesday. The indicative rates on the three-month paper issued by manufacturing companies were unchanged from Tuesday at 6.54-6.75%.

Unlike the high issuance in CP market, ample liquidity kept banks' demand for CD in check, dealers said. According to data from Reserve Bank of India, the central bank net absorbed INR 1.60 trillion on Tuesday from the system, marginally down from INR 1.65 trillion on Monday. The figure is a proxy for the liquidity surplus in the banking system. Banks having ample funds was evident as they had parked INR 1.77 trillion with the central bank under Standing Deposit Facility, as per the data. This kept the rates on three-month paper issued by banks unchanged from Tuesday at 6.48-6.68%.

Some traders being away from treasury desks due to a truncated week and Fixed Income Money Market and Derivatives Association of India's annual conference over the weekend also limited market activity, dealers said. Money markets are shut Friday on account of Good Friday. "Banks are in no urgency to borrow funds right now because of good surplus," a dealer at a state-owned bank said. "This will continue even tomorrow because a lot of traders will go to attend FIMMDA event which will start from tomorrow (Thursday)."

--Primary market

* Godrej Consumer Products, NTPC, Reliance Jio Infocomm, Reliance Industries, Bajaj Finance, Bajaj Housing, Godrej Properties and Kotak Mahindra Investments raised funds through CPs.

* No funds were raised through CDs. 

--Secondary market

* Bank of Baroda's CD maturing Thursday was traded six times at a weighted average yield of 5.9658%.

* National Bank for Agriculture and Rural Development's CP maturing Thursday was traded seven times at a weighted average yield of 5.9339%.

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

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Ashish Shirke

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