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Informist, Wednesday, Sept. 17, 2025

By Ketaki Patil

MUMBAI – Yields in the secondary market of corporate bonds ended steady Wednesday as traders stayed cautious and abstained from placing large bets ahead of the outcome of the US Federal Open Market Committee meeting later in the day, dealers said. Levels were largely unchanged across tenures, with only a 1–2 basis points' movement seen in select papers. Despite some movement in government securities and the rupee, which reacted to potential rate cut expectations from the US FOMC, corporate bond yields remained unaffected. 

"In NCDs (non-convertible debentures), levels were more or less similar to yesterday (Tuesday)... we saw a 1–2 bps move in select papers, but no significant deals happened," a dealer at a state-owned bank said. "The Fed meeting is important, but so far we have not seen any direct impact in corporate bonds. Most participants are waiting for the Fed commentary before taking positions."

The Fed is likely to cut rates by 25 basis points later in the day, after holding them steady at 4.25-4.50% since December. Fed funds futures traders are now pricing in a 94% chance of the Fed cutting interest rates by 25 bps on Wednesday, with a 6% probability of a jumbo 50-bps cut, CME FedWatch showed. 

In the secondary market, deals aggregating to INR 133.68 billion were recorded on the National Stock Exchange and BSE combined Wednesday, higher than INR 93.40 billion Tuesday. Mutual funds and insurance companies were active in shorter tenures, while pension funds continued to look for buyers. Corporate entities were largely absent, dealers said.

Papers issued by Kerala Infrastructure Investment Fund Board, Muthoot FinCorp. Ltd., Navi Finserv Ltd., National Bank For Agriculture And Rural Development, Telangana State Industrial Infrastructure Corp. Ltd., The Andhra Pradesh Mineral Development Corp. Ltd., Anand Rathi Global Finance Ltd., were traded the most.

In the primary market, issuances aggregating to INR 11.35 were in line to raise funds Wednesday. Nuvoco Vistas Corp. Ltd. was fully subscribed and raised INR 6.00 billion through the issuance of three-year bonds at a coupon of 7.70%. Nuvama Wealth and Investment Ltd. raised INR 2 billion by issuing bonds maturing Oct. 18, 2027. "There was fine traction in the short-end (bonds in primary market), but largely sentiment is still muted as there are no large issuers tapping the market." a dealer at a mid-sized brokerage said. "Investors are waiting for larger PSUs (public sector undertakings) issuances to set the tone."

On Thursday, bond issuances aggregating up to INR 38.30 billion will tap the bond market. TVS Credit Services plans to raise INR 7.00 billion through the bonds maturing Sept. 19, 2028 bond issuances. Godrej Industries Ltd., Aditya Birla Housing Finance Ltd., NIIF Infrastructure Finance Ltd., 360 ONE Prime Ltd., Credila Financial Services Ltd., and Kanakadurga Finance Ltd. have invited bids to borrow funds from the market.

UDAY BONDS

In the secondary market, Ujwal DISCOM Assurance Yojana bonds aggregating INR 47.00 million were traded at a weighted average yield of 6.6789-7.389%, according to data from the RBI's Negotiated Dealing System-Order Matching System Wednesday.

* INR 44.00 million of Uttar Pradesh's 8.75%, 2030 bond was dealt at a weighted average yield of 6.6789%

* INR 2.00 million of Tamil Nadu's 8.04%, 2029 bond was dealt at a weighted average yield of 6.8109%

* INR 1.00 million of Uttar Pradesh's 8.49%, 2028 bond was dealt at a weighted average yield of 7.389%

BENCHMARK LEVELS FOR CORPORATE BONDS:

End

Edited by Deepshikha Bhardwaj

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