More Stories

Informist, Thursday, Jun. 5, 2025

By Siddhi Chauhan

MUMBAI – Fundraising through commercial paper rose significantly Thursday owing to a big-ticket issuance by Reliance Retail Ventures Ltd., which raised INR 20.00 billion, dealers said. Redemption pressure also prompted some issuers to tap the short-term debt market, they said.

"A huge sum was set to mature today (Thursday)," said a dealer at a brokerage fund. "Some issuers had already frontloaded their borrowing in the previous days. If you see, Monday was quite heavy on the issuance side. The remaining issuers would have felt they could get better rates ahead of the MPC (Monetary Policy Committee meeting outcome), so they would have waited till today." According to data compiled by Informist Media, CP worth INR 142.80 billion were set to mature Thursday.

CP worth INR 47.00 billion were issued Thursday, up from INR 6.50 billion Wednesday. Bharat Heavy Electricals Ltd. raised INR 6.50 billion through a three-month paper at 6.42%. Wednesday, ICICI Securities Primary Dealership was the largest CP issuer, raising INR 3.00 billion through three-month paper at 6.43%.

Issuances in the certificates of deposit market were similar to Wednesday as most banks remained cautious ahead of the Reserve Bank of India's monetary policy outcome. Only banks which had rollover requirements tapped the short-term debt market, dealers said. Thursday, INR 21.00 billion were raised through CDs. 

"Most banks are exercising caution ahead of MPC, but what to do if you have a maturity? You will have to come to the market," a dealer at a public-sector bank said. "We are seeing good traction in the secondary market ahead of the outcome as PSUs (state-owned banks) are earning profits by selling the shorter tenure paper and buying longer tenure paper for better yields."

Bank of Baroda was the largest CD issuer Thursday and raised INR 16.00 billion through a three-month paper at 6.07%. Punjab & Sind Bank raised INR 5.00 billion through a three-month paper at 6.15%. 

Though the market has factored in the likelihood of a 25-basis-point rate cut, the outcome of the three-day meeting will be watched closely, dealers said. RBI Governor Sanjay Malhotra will announce the outcome at 1000 IST Friday. There is also an expectation that the RBI will widen the liquidity adjustment facility corridor by reducing the standing deposit facility rate by an additional 25 bps.

Currently, the width of the LAF corridor is 50 bps, with the standing deposit facility acting as the floor at 5.75% and the marginal standing facility as the ceiling at 6.25%, the repo rate being the mid-point. If the framework is asymmetrically widened at the lower end when the repo rate is cut to 5.75%, the LAF corridor would be 5.25-6.00%.

Indicative rates on three-month CP by non-banking finance companies were quoted at 6.30–6.50% Thursday, while manufacturing companies offered similar tenors at 6.07–6.37%. Three-month CD rates were in the 6.07–6.25% range.

--Primary market

* Reliance Retail Ventures, Network 18 Media and Investments Ltd., Tata Projects, Bharat Heavy Electricals Ltd., ICICI Securities Primary Dealership, Kotak Securities, Axis Securities, Birla Group Holdings, L&T Finance Ltd., and Axis Finance Ltd. raised funds through CP.

* Bank of Baroda and Punjab & Sind Bank raised funds through CDs.

--Secondary market

* Bank of Baroda's CD maturing Friday was traded seven times at a weighted average yield of 5.7659%.

* Reliance Retail Ventures Ltd.'s CP maturing Friday was traded 12 times at a weighted average yield of 5.7683%.

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 Rajeev Pai

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.