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Informist, Monday, Oct. 13, 2025

By Vaishali Tyagi

MUMBAI – Yields on corporate bonds in the secondary market remained in a narrow band Monday as participants shifted their focus to the primary market, as several non-banking financial companies tapped the bond market, and some key marquee issuers will tap the bond market Tuesday, dealers said. The activity in the secondary market remained limited to requirement-based trades, which kept the yields steady, they said.

Earlier in the day, buying demand from mutual funds and banks led to a decline in yields. However, the gains were short-lived as selling pressure emerged during the primary market bidding, particularly for key non-banking financial companies. This pushed yields back up to levels just 1-2 basis points higher than earlier, depending on the tenure.

"The market was mostly positive today (Monday), with some corporates active in the secondary market and banks and mutual funds active (buying and selling), meeting their requirements," a dealer at a brokerage firm said. "Even though the trading volume was not substantial, deals were executed, such as mutual funds selling longer-tenure papers to invest in shorter-duration bonds. We also heard that they were selling to reserve cash for participation in the primary market, as it has gained momentum since Friday."

In the primary market, companies issued bonds worth INR 30.75 billion Monday, slightly lower than INR 38.35 billion raised on Friday. On Tuesday, issuances aggregating to INR 194.96 billion are scheduled. Bharti Telecom has invited bids to raise a whopping INR 105 billion through two bonds of different maturities. Poonawalla Fincorp plans to raise INR 25 billion through two bonds. Amongst other big NBFCs, Kotak Mahindra Investment and Aditya Birla Capital plan to raise INR 6.5 billion and INR 7.5 billion, respectively, through bonds. Bilaspur Pathrapali Road, Signatureglobal India, and Iinspira Springdale are also scheduled to tap the corporate debt market Tuesday.

In the secondary market, deals aggregating to INR 83.65 billion were recorded on the National Stock Exchange and BSE combined Monday, significantly lower than INR 100.08 billion on Friday. Mutual funds and banks were actively buying and selling papers across various tenures, with a more pronounced buying demand in shorter-tenure papers. Companies were active in the secondary market to buy bonds. A few insurance companies, along with a handful of pension funds, were active in buying and selling longer tenure papers. 

Papers issued by Kerala Infrastructure Investment Fund Board, Muthoot Finance, Navi Finserv, Telangana State Industrial Infrastructure Corp., Kotak Mahindra Prime, HDB Financial Services, National Bank for Agriculture and Rural Development, Whizdm Finance, Apex Homes, IIFL Finance, and Indian Railway Finance Corp. were traded the most on bourses Monday. 

Dealers expect the primary corporate bond market to remain active. Market participants said that recent bond issuances are largely driven by specific requirements ahead of the festival season. However, dealers anticipate a pickup in primary market activity by the end of this week. "Some big issuances are coming these days and we can expect it to pick up more as we approach the festive season," the dealer quoted above said.

Dealers said market participants are keeping a close eye on the minutes of the Monetary Policy Committee meeting that ended on Oct. 1, which will be released Wednesday. Data released during market hours showed that India's headline inflation fell to an over eight-year low of 1.54% in September, in line with expectations. The CPI data had no material impact on the market, dealers said. 

UDAY BONDS

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In the secondary market, Ujwal DISCOM Assurance Yojana bonds aggregating to INR 214.00 million were traded at a weighted average yield of 5.8215-6.9719%, according to data on the RBI's Negotiated Dealing System-Order Matching System Monday.

* INR 150.00 million of Jharkhand's 8.22%, 2026 bond was dealt at a weighted average yield of 6.2411%

* INR 40.00 million of Uttar Pradesh's 8.49%, 2028 bond was dealt at a weighted average yield of 6.8406%

* INR 12.00 million of Andhra Pradesh's 7.35%, 2030 bond was dealt at a weighted average yield of 6.7181%

* INR 5.00 million of Uttar Pradesh's 8.14%, 2026 bond was dealt at a weighted average yield of 5.8215%

* INR 5.00 million of Uttar Pradesh's 8.42%, 2027 bond was dealt at a weighted average yield of 6.9719%

* INR 2.00 million of Tamil Nadu's 8.04%, 2029 bond was dealt at a weighted average yield of 6.5870%

BENCHMARK LEVELS FOR CORPORATE BONDS:

End

Edited by Saji George Titus

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