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Informist, Wednesday, Jun. 18, 2025

By Vaishali Tyagi

MUMBAI – Yields on corporate bonds were broadly steady in the secondary market Wednesday due to lack of fresh domestic triggers, dealers said. Churning of portfolio by mutual funds and state-owned banks was not significant enough to move the yields. Dealers said traders are reallocating their positions mostly in shorter-tenure bonds.

There was some activity but it was mainly need-based as investors do not see any cues ahead for some time, a dealer at a mid-sized brokerage firm said. "Mutual funds bought and sold in some papers (based on requirement), and other participants (state-owned banks and insurance companies) reallocated their positions."

Activity in the secondary market surged on Tuesday due to limited primary market issuances, with buying interest from diverse participants driving yields down. However, the buying momentum waned Wednesday and was balanced out by selling.

On Wednesday, deals worth INR 54.80 billion were recorded on the National Stock Exchange and the BSE combined at 1500 IST, down from INR 67.69 billion Tuesday. Some mutual funds and state-owned banks were reportedly active sellers, but mutual funds and insurance companies were also seen buying. A handful of private banks also traded in papers on both the buying and selling sides. Pension funds remained absent from the market, dealers said.

Papers issued by REC Ltd., State Bank of India, the Andhra Pradesh Mineral Development Corp., Power Finance Corp., Telangana State Industrial Infrastructure Corp., National Bank for Agriculture and Rural Development, Small Industries Development Bank of India were traded the most on the exchanges.

In the primary market, activity remained subdued. LIC Housing Finance Wednesday raised INR 32.50 billion at 6.90% through bonds maturing on Sept. 17, 2027. The issue had a base size of INR 11 billion and a greenshoe option of INR 25 billion.

On Thursday, several non-banking finance companies have lined up bond issuances. There was no news of any state-owned company planning to tap the market until the time of reporting. On Thursday, IndiGrid Infrastructure Trust will raise up to INR 30 billion through three bonds of different maturities. Vedika Credit Capital and Aye Finance have sought bids to raise funds through respective bonds.

UDAY BONDS

In the secondary market, only Haryana's Ujwal DISCOM Assurance Yojana bonds worth INR 2.70 million were traded, data from the Reserve Bank of India's Negotiated Dealing System–Order Matching System showed Wednesday. The state's Jun. 30, 2025 bonds were dealt at a weighted average yield of 6.9885%.

BENCHMARK LEVELS FOR CORPORATE BONDS:

End

With inputs from Aaryan Khanna

Edited by Ashish Shirke

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