India Corporate Bonds
Yields steady; primary mkt activity to rise in Oct-Mar
This story was originally published at 20:06 IST on 21 August 2025
Register to read our real-time news.Informist, Thursday, Aug. 21, 2025
By Ketaki Patil and Vaishali Tyagi
MUMBAI – Yields on corporate bonds ended steady in the secondary market on Thursday due to requirement-based trading, dealers said. "There was some activity, but it was just requirement-based," a dealer at a mid-sized brokerage firm said. "Market is currently range-bound, and traders are just stepping in for the needs of their portfolio or to make space for new issuances." Many traders are waiting for new bond issuances rather than actively trading in the secondary market, dealers said.
Trading activity in the corporate bond market was concentrated in short-tenure papers, with the 2026 segment being the most active. Dealers said papers from institutions like the National Bank for Agriculture and Rural Development, Small Industries Development Bank of India, and REC Ltd. saw both buying and selling activity in this segment. According to dealers, some mutual funds were observed to be selling corporate bonds in the secondary market due to redemption pressure. However, investors are holding back on investments, awaiting upcoming fresh bond issuances.
In the secondary market, deals aggregating to INR 46.96 billion were recorded on the National Stock Exchange and BSE combined on Thursday at 1500 IST, broadly unchanged from INR 46.27 billion the previous day. Mutual funds were seen active on both the buying and selling sides, along with a handful of pension funds, dealers said. Banks and insurance companies were seen buying across tenures. Corporate enities were absent from the market on Thursday.
Papers issued by Kerala Infrastructure Investment Fund Board, Navi Finserv Ltd., National Bank For Agriculture and Rural Development, Telangana State Industrial Infrastructure Corp. Ltd., Sammaan Capital Ltd., The Andhra Pradesh Mineral Development Corp. Ltd., Rural Electrification Corp. Ltd., Akara Capital Advisors Pvt Ltd., Muthoot Capital Services Ltd. were the most traded on exchanges on Thursday.
In the primary market, several companies were to raise funds aggregating to INR 20.50 billion through corporate bond issuances on Thursday. On Friday, bond issuances in the primary market will be in high volume, aggregating to over INR 55 billion. Bajaj Finance Ltd. plans to raise INR 50 billion through Aug. 25, 2035 bonds. Poonawalla Fincorp Ltd. has invited bids to raise up to INR 5 billion through bonds maturing Feb 25, 2028. Hinduja Leyland Finance Ltd. has also invited bids to raise INR 500 million through three-year bonds maturing Aug 25, 2028.
Market participants expect a surge in primary market activity from Oct-Dec. "Market participants expect primary market activity to pick up as soon as October starts, as the second half of the year is generally more active and corporates tend to raise funds in the second half," said the dealer quoted earlier.
UDAY BONDS
In the secondary market, Ujwal DISCOM Assurance Yojana bonds aggregating to INR 15.00 million were traded at a weighted average yield of 6.7666-7.5368%, according to data from the RBI's Negotiated Dealing System-Order Matching System.
* INR 3.00 million of Telangana's 7.96%, 2032 bond was dealt at a weighted average yield of 6.8649%
* INR 1.00 million of Jharkand's 8.62%, 2030 bond was dealt at a weighted average yield of 6.7809%
* INR 1.00 million of Uttar Pradesh's 8.75%, 2030 bond was dealt at a weighted average yield of 6.7718%
* INR 1.00 million of Uttar Pradesh's 8.49%, 2028 bond was dealt at a weighted average yield of 7.5368%
* INR 1.00 million of Jammu and Kashmir's 8.48%, 2029 bond was dealt at a weighted average yield of 6.7666%
* INR 1.00 million of Jammu and Kashmir's 8.22%, 2026 bond was dealt at a weighted average yield of 7.2543%
* INR 1.00 million of Tamil Nadu's 8.04%, 2029 bond was dealt at a weighted average yield of 7.4998%
* INR 1.00 million of Madhya Pradesh's 8.05%, 2029 bond was dealt at a weighted average yield of 73997%
* INR 1.00 million of Punjab's 8.48%, 2029 bond was dealt at a weighted average yield of 7.2707%
* INR 1.00 million of Punjab's 8.22%, 2026 bond was dealt at a weighted average yield of 7.2543%
* INR 1.00 million of Punjab's 8.21%, 2026 bond was dealt at a weighted average yield of 7.2444%
* INR 2.00 million of Rajasthan's 8.39%, 2026 bond was dealt at a weighted average yield of 7.0160%
BENCHMARK LEVELS FOR CORPORATE BONDS:
| Tenure | THURSDAY | WEDNESDAY |
| Three-year | 6.83-6.86% | 6.83-6.85% |
| Five-year | 6.94-6.97% | 6.94-6.96% |
| 10-year | 7.11-7.13% | 7.12-7.14% |
End
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Avishek Dutta
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