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Informist, Wednesday, Jun. 4, 2025

By Sachi Pandey

MUMBAI – Fundraising through short-term debt instruments slowed significantly on Wednesday as issuers took a breather after frontloading their borrowing a day earlier, dealers said. Issuances through commercial papers Wednesday fell to INR 6.50 billion against INR 100.75 billion raised on Tuesday as many companies had already met their immediate funding needs.

"Many issuers had raised a large chunk of funds yesterday (Tuesday) so obviously the demand has died down today (Wednesday)," a dealer at a brokerage fund said.

The largest CP issuer on Wednesday was ICICI Securities Primary Dealership, raising INR 3 billion through three-month papers at 6.43% rate. Bharat Heavy Electricals Ltd. followed closely behind with INR 2.5 billion in CPs of the same maturity at 6.47% rate. On Tuesday, Export-Import Bank of India led fundraising with an INR 24.50 billion CP issue at a rate of 6.10%.

Banks mostly stayed on the sidelines Wednesday. Only Bank of India tapped the market, issuing INR 21 billion in three-month certificates of deposit at 6.10% rate. A day earlier, banks cumulatively raised INR 30 billion through CDs, led by Bank of Baroda, which issued INR 20 billion at 6.07% rate.

Rates remained steady Wednesday after falling 5–10 basis points across the curve on Tuesday. Three-month CPs by non-banking financial companies were quoted at 6.30–6.50%, while manufacturing companies offered similar tenors at 6.07–6.37%. Three-month CD rates were in the 6.05–6.25% range.

Meanwhile, banking system liquidity remained comfortable, with the Reserve Bank of India absorbing INR 3.01 trillion on Tuesday, up from INR 2.77 trillion on Monday. Funds parked under the Standing Deposit Facility also rose to INR 3.14 trillion--the highest in nearly two months--from INR 2.92 trillion.

"In the secondary market, banks are profit booking, while mutual funds are picking those papers. They are selling March papers at good levels," the dealer quoted above said.

--Primary market

* ICICI Securities Primary Dealership, Bharat Heavy Electricals Ltd., and Aditya Birla Money raised funds through CPs.

* Bank of India raised funds through CDs.

--Secondary market

* IndusInd Bank's CD maturing Thursday was traded three times at a weighted average yield of 6.2061%.

* Small Industries Development Bank of India's CP maturing Thursday was traded three times at a weighted average yield of 5.7019%.

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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