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Informist, Thursday, Apr. 17, 2025

By Siddhi Chauhan

MUMBAI – Issuances in the commercial paper market fell sharply Thursday as most issuers had already raised a significant share of funds at the start of the week, dealers said. On Thursday, CPs worth INR 19.75 billion were raised, sharply down from INR 109.00 billion Wednesday.

"A lot of issuers have already raised funds in the starting of the week, so there doesn't seem to be enough demand," a dealer at a brokerage fund said. Excluding Thursday, CPs worth INR 142.24 billion have been raised in just two working days this week. Money markets were shut Monday on account of Ambedkar Jayanti and will be closed on Friday for Good Friday. "Also a long weekend is here, no one wants to raise funds today (Thursday) because of uncertainty in case of rates."

On Thursday, the indicative rates on three-month CPs issued by manufacturing companies were unchanged from Wednesday at 6.54-6.75%. Indicative rates on the three-month papers issued by non-banking financial companies were unchanged from Wednesday at 6.70-6.90%. 

Indian Oil Corp. Ltd. was the largest CP issuer raising INR 15.75 billion through a near three-month CP at 6.40%. ONGC Petro Additions Ltd. raised INR 4 billion through a three-month paper at 6.75%. 

The certificates of deposit market was dry for the third time this week due to comfortable liquidity, dealers said. According to data from the Reserve Bank of India, the central bank net absorbed INR 1.70 trillion Wednesday from the banking system, slightly up from INR 1.60 trillion Tuesday. Banks having ample funds was evident as they had parked INR 1.88 trillion with the central bank under the Standing Deposit Facility, as per the data.

Traders being away from desk due to the long weekend and the annual conference of the Fixed Income Money Market and Derivatives Association of India also limited trading in both markets, dealers said. "Traders do not want to borrow before a long weekend so they are probably waiting till Monday and then according to individual bank needs they might borrow," a dealer at a private sector bank said. "The requirement is also not that high because of surplus liquidity." 

--Primary market

* IOCL and ONGC Petro Additions Ltd raised funds through CPs.

* No funds were raised through CDs. 

--Secondary market

* Union Bank's CD maturing Apr. 30 was traded once at a weighted average yield of 6.1990%.

* Bajaj Finance Ltd's CP maturing Monday was traded once at a weighted average yield of 5.8986.

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 Tanima Banerjee

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