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Informist, Wednesday, Sept. 10, 2025

 

By Shravani Chandiwade

 

MUMBAI – Primary issuances in the commercial paper market remained high for the second consecutive day, driven by increased borrowing from non-banking finance companies, dealers said. Primary borrowing through CP on Wednesday totalled INR 57.00 billion. However, banks did not approach the market to raise any money through certificates of deposit.

 

Reliance Retail Ventures was the biggest CP issuer on Wednesday. The company raised INR 22.00 billion through a three-month CP at 5.97%. Total INR 104.25 billion CPs of the company are set to mature this month and so far this month it has raised INR 58.25 billion.

 

ICICI Securities and Bajaj Finance Securities were the other large issuers. The two raised INR 5.50 billion each through three-month CP at 6.72%. Axis Securities also raised INR 2 billion at the same rate for the same tenure. Meanwhile, SBI Capital Securities had to pay 6.77% for INR 5 billion of its three-month paper.

 

Increased participation in the CP market slightly pushed the rates up for non-banking finance companies Wednesday, dealers said. Indicative rates on three-month papers of non-banking financial companies were 6.93–6.95%, up from 6.85–6.88% Tuesday. Rates on papers of the same tenure issued by manufacturing companies were 5.90–5.95%, broadly unchanged from Tuesday.

 

Borrowing through certificates of deposit was nil on Wednesday as banks remained on the sidelines due to lack of investor appetite. "There is ample liquidity surplus in the banking system, so banks will not likely tap the CD market," a dealer at a state-owned bank said. Latest Reserve Bank of India data shows liquidity in the banking system increased to INR 2.65 trillion Tuesday from INR 2.36 trillion Monday, despite outflows of tax deducted at source and excise duty payouts that began Sunday.

 

Traders said some banks were trying to raise funds through CD but due to limited appetite from mutual funds, no deals were concluded and issuances remained nil for the day. However, in the secondary market, mutual funds were actively selling CD due to redemption pressure as large corporates were seen channelling their investments in state government securities, dealers said. Moreover, some dealers cited redemption pressure on mutual funds before advance tax payment for the September quarter, due Monday.

 

As there were no issuances, the indicative rates in the CD market remained steady. Rates on three-month CD were 5.77-5.80%, unchanged from Tuesday, dealers said. Rates on six-month CD remained at 6.05-6.16% and those on one-year paper were 6.30-6.35%, they said.

 

--Primary market
* No bank raised funds through CDs.

* Grasim Industries, Tata Capital, HDFC Securities, Kotak Securities, ICICI Securities, Axis Securities, Bajaj Finance Securities, Kotak Mahindra Prime, SBI Capital Securities, Julius Baer Capital, and Aditya Birla Money raised funds through CP.

 

--Secondary market

* HDFC Bank's CD maturing on Sept. 19 was traded once at a yield of 5.6508%

* Sikka Ports and Terminal's CP maturing Thursday was traded three times at a weighted average yield of 5.3298%

 

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:

 

Certificates of deposit		Commercial paper
Wednesday	Tuesday	Wednesday	Tuesday
52.10	83.70	72.40	69.60

 

End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Edited by Ashish Shirke

 

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