India Corporate Bonds
Ylds steady; activity limited on low supply of bonds
This story was originally published at 20:02 IST on 16 September 2025
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By Vaishali Tyagi
MUMBAI – Yields on corporate bonds ended steady in the secondary market on Tuesday because of limited supply in the primary market, dealers said. Lack of fresh issuances kept participants on the sidelines which eventually resulted in yields in secondary market being unchanged across tenures.
"There was nothing on EBP (electronic bidding platform) today, which resulted in subdued activity in the secondary market as well... there was no aggressive trading in secondary market," a dealer at a mid-sized brokerage said. Dealers said that even though some mutual funds and pension funds were active in some tenures, there wasn't enough momentum to move the levels. "Some mutual funds were seen buying and selling papers in longer tenures, but these trades were not sufficient to impact yields significantly," the dealer quoted above said.
Dealers said the domestic market currently lacks a major trigger to provide guidance, leading most participants to wait for the US Federal Reserve's interest rate decision this week. "This (US Fed's interest rate) decision is expected to offer some direction to the market...since there is no domestic trigger right now," the dealer said. Though some traders believe the Fed's decision will have a limited impact, as expectations are already priced in, they are still keen on further clarity.
In the secondary market, deals aggregating INR 93.40 billion were recorded on the National Stock Exchange and BSE combined, lower than INR 106.39 billion Monday. Corporates, banks, and insurance companies were absent from the market.
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., and Power Finance Corp. Ltd. were traded the most.
In the primary market, there were no fresh issuances. "Primary market activity was extremely dull, with no deals on bidding platforms...people may come to tap the market after the US FOMC rate decision," a fund manager at a mutual fund said. "Traders will assess the (US) rate-setting panel's commentary and its impact on the government securities market, and corporate debt market is likely to follow the path."
On Wednesday, bond issuances aggregating INR 11.35 billion are lined up. Nuvoco Vistas Corp. Ltd. plans to raise INR 6.00 billion and Nuvama Wealth and Investments plans to raise INR 2.00 billion. Muthoot Fincorp Ltd., Vivriti Capital Ltd., and Muthoottu Mini Financiers Ltd. have invited bids to borrow funds from the market.
UDAY BONDS
In the secondary market, Ujwal DISCOM Assurance Yojana bonds aggregating INR 37.40 million were traded at a weighted average yield of 6.3435-7.4846%, according to data from the RBI's Negotiated Dealing System-Order Matching System Tuesday.
* INR 12.00 million of Andhra Pradesh's 7.35%, 2030 bond was dealt at a weighted average yield of 6.9642%
* INR 10.00 million of Uttar Pradesh's 8.49%, 2028 bond was dealt at a weighted average yield of 6.6463%
* INR 5.70 million of Tamil Nadu's 8.04%, 2029 bond was dealt at a weighted average yield of 7.2059%
* INR 5.00 million of Uttar Pradesh's 8.14%, 2026 bond was dealt at a weighted average yield of 6.3435%
* INR 3.00 million of Tamil Nadu's 7.75%, 2032 bond was dealt at a weighted average yield of 7.12%
* INR 1.70 million of Himachal Pradesh's 8.17%, 2028 bond was dealt at a weighted average yield of 7.4846%
BENCHMARK LEVELS FOR CORPORATE BONDS:
| Tenure | TUESDAY | MONDAY |
| Three-year | 6.87%-6.89% | 6.87%-6.89% |
| Five-year | 6.99%-7.04% | 7.01%-7.05% |
| 10-year | 7.20%-7.24% | 7.19%-7.22% |
End
Edited by Ashish Shirke
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