More Stories

Informist, Tuesday, Apr. 22, 2025

By Ashna Mariam George

MUMBAI – Corporate bond yields fell marginally across tenures Tuesday, tracking a fall in yields on government securities, dealers said. Government securities yields fell around 2 basis points during the day due to demand from pension funds and insurance companies, according to dealers. However, yields on government bonds closed 1-2 bps higher than the previous close.

"Market was comparatively better than yesterday's and yields are down by around 1-2 bps tracking the G-secs," a dealer at a mid-sized brokerage firm said. "Shorter tenure and longer tenure was very active today...banks and mutual funds were on both (buying and selling) sides and pension funds were buying in long-term." 

An increase in demand led to an improvement in trade volume with deals aggregating INR 149.91 billion recorded on the National Stock Exchange and BSE combined, up from INR 128.63 billion reported Monday. Papers issued by LIC Housing Finance, the National Bank For Agriculture And Rural Development, Bajaj Finance, Tata Capital Financial Services, Bharti Telecom, Muthoot Finance, and the Small Industries Development Bank of India were the most traded on the exchanges. 

With similar movements in the government bond market and corporate bond market, dealers expect the spread between government securities and corporate bonds to depend on supply in the near term. "G-sec (government securities' yields) is moving much faster (than corporate bonds), so right now is difficult to predict if the spreads will widen or narrow, it will depend on the supply of corporate bonds in next months," a fund manager at a mid-sized mutual fund house said. "If the supply goes up, spreads will widen, but if it goes down the spreads will narrow or stay wherever they are." On Tuesday, the spread between 10-year benchmark government security and corporate bond was 53 bps, almost unchanged from 52 bps Monday.

Issuances in the primary market picked up Tuesday with three major issues during the day. Sundaram Finance raised INR 7.5 billion through two-year bonds at a coupon of 7.35%. Home financier ICICI Home Finance Co. raised INR 4.25 billion through two-year bonds maturing on Jun. 28, 2027, and INR 2.75 billion through near-three-year bonds maturing on Jul. 24, 2028. Aditya Birla Housing Finance also tapped the market Tuesday and raised INR 3 billion through 10-year bonds.

The National Housing Bank has invited bids Wednesday to raise up to INR 50 billion through seven-year bonds maturing on Apr. 2, 2032. Market participants expect the issue to sell at a coupon of 6.85-6.90%.

UDAY BONDS

In the secondary market, Ujwal DISCOM Assurance Yojana bonds aggregating INR 308.00 million were traded at a weighted average yield of 6.3000-6.9897%, data from the Reserve Bank of India's Negotiated Dealing System–Order Matching System showed Tuesday.

* INR 250.00 million of Madhya Pradesh's Mar. 22, 2026 bonds were dealt at a weighted average yield of 6.3001%

* INR 50.00 million of Rajasthan's Mar. 15, 2026 bonds were dealt at a weighted average yield of 6.3000%

* INR 8.00 million of Uttar Pradesh's Mar. 21, 2027, and Jun. 2, 2027 bonds were dealt at a weighted average yield of 6.8451-6.9897%

BENCHMARK LEVELS FOR CORPORATE BONDS:

End

Edited by Deepshikha Bhardwaj

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

Informist Media Tel +91 (22) 6985-4000 

Send comments to feedback@informistmedia.com

© Informist Media Pvt. Ltd. 2025. All rights reserved.