India Corporate Bonds
Yields steady; IREDA raises INR 4.53 bln at 7.70%
This story was originally published at 20:02 IST on 11 September 2025
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By Ketaki Patil
MUMBAI – Corporate bond yields ended steady Thursday in the secondary market as participants remained focused on developments in the primary market, dealers said. "People are engaging, but the levels are in the same range," a dealer at a state-owned bank said. Issuances aggregating to INR 63.50 billion were lined up in the primary market Thursday, including the keenly eyed INR-5-billion issuance by Indian Renewable Energy Development Agency.
Thursday, the primary market was busy with several issuances of non-banking financial companies and a state-owned entity. IREDA raised INR 4.53 billion at a coupon of 7.70% on its perpetual bonds against the targeted INR 5.00 billion. According to the bid book accessed by Informist, the company received 65 bids aggregating to INR 13.43 billion in the coupon range of 7.55-8.04%. The issue drew strong investor interest, which resulted in oversubscription by 2.69 times, IREDA said in a release. Dealers said the coupon came in lower than expectations, and the issue did not raise the targeted amount despite its relatively small size.
Some dealers feared that activity in the corporate bond market might be hampered by liquidity if the Reserve Bank of India intervenes in the foreign exchange market to support the rupee. With the rupee hitting an all-time low of 88.4550 against the dollar Thursday, there are expectations that the RBI will sell dollars to stabilise the currency. "If the RBI is selling dollars, that means they are taking out liquidity from the system. So, unless there is clarity on open market operations, there will be tightness for some time," a dealer said.
The expectations of a rate cut are also being pushed out, with recent growth numbers leaving little incentive for the RBI to ease policy, the dealer said.
Bond issuances aggregating to INR 39.80 billion are lined up for Friday. Among those who plan to tap the market are Kotak Mahindra Prime, Tata Capital, Bajaj Housing Finance, Ugro Capital, Mindspace Business Parks REIT, and Akme Fintrade (India). Most of these bonds are short-term.
In the secondary market, deals aggregating INR 115.37 billion were recorded on the National Stock Exchange and BSE combined, lower than INR 134.09 billion on Wednesday. Mutual funds were active on both the buying and selling side, while pension funds looked to sell but couldn't find buyers, dealers said. A handful of insurance companies were also active, but corporate entities remained largely absent, dealers said.
Kerala Infrastructure Investment Fund Board, Muthoot FinCorp, AYE Finance, Navi Finserv, Telangana State Industrial Infrastructure Corp., Sammaan Capital, Andhra Pradesh Mineral Development Corp., and Vivriti Capital were the most traded papers Thursday.
UDAY BONDS
In the secondary market, Ujwal DISCOM Assurance Yojana bonds aggregating to INR 16.50 million were traded at a weighted average yield of 6.2570-7.0506%, according to data from the RBI's Negotiated Dealing System-Order Matching System Thursday.
* INR 13.0 million of Tamil Nadu's 7.75%, 2028 bond was dealt at a weighted average yield of 6.5961%
* INR 2.00 million of Rajasthan's 8.19%, 2026 bond was dealt at a weighted average yield of 6.2570%
* INR 1.50 million of Jharkhand's 8.72%, 2031 bond was dealt at a weighted average yield of 7.0506%
BENCHMARK LEVELS FOR CORPORATE BONDS:
| Tenure | THURSDAY | WEDNESDAY |
| Three-year | 6.84-6.86% | 6.85-6.88% |
| Five-year | 6.98-7.00% | 6.99-7.01% |
| 10-year | 7.17-7.20% | 7.16-7.19% |
End
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Saji George Titus
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