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Informist, Thursday, Oct. 23, 2025

By Vaishali Tyagi

MUMBAI – Issuances in the short-term debt market rose sharply Thursday as banks and companies flocked to the market to fulfil their rollover requirements for October, dealers said. Mutual funds were seen actively investing in the debt instruments, they said. "Many companies and banks tapped the market to fulfill their roll-over requirements," a dealer at a state-owned bank said. 

On the certificates of deposit front, issuances surged with four banks and Small Industries Development Bank of India, an apex financial institution, cumulatively raising INR 56.25 billion. Indian Bank borrowed INR 15 billion through one-year paper at 6.43% while IDFC FIRST Bank raised INR 15 billion through an eight-month paper at 6.45%. Punjab National Bank raised INR 11.25 billion through a one-month paper at 5.79% and Kotak Mahindra Bank borrowed INR 10 billion by issuing seven-month paper at 6.22%. SIDBI raised INR 5 billion through a one-year paper at 6.49%. There was no CD issuance Monday as most of the traders were absent from the market.

Despite the sharp rise in issuances, the indicative rates in the CD market remained unchanged from Monday on account of strong appetite from mutual funds, which are major investors in this market, dealers said. Indicative rates for three-month CDs were 5.86-5.97%, unchanged from Monday. Yields on papers maturing in six months and one year also remained unchanged at 6.12–6.22% and 6.38–6.45%, respectively, dealers said.

Total issuances of commercial papers rose to INR 17 billion Thursday, from no CP issuance reported Monday. SIDBI was the largest CP issuer, raising INR 5.5 billion through a three-month paper at 6.05%. The other major CP issuer was Aditya Birla Capital Ltd., raising INR 4.00 billion through paper maturing at the end of January at 6.30%. Most of the non-banking financial companies tapped the market to roll over upcoming maturities, dealers said. Other CP issuers included HDFC Securities Ltd., ICICI Home Finance Ltd., Godrej Industries Ltd, Godrej Properties Ltd., and Bajaj Finance Ltd. 

Indicative rates in the CP market were also unchanged on limited activity. Rates on three-month CPs issued by manufacturing companies were 5.95-6.05%, unchanged from Monday. Rates on similar maturity papers issued by non-banking financial companies also were unchanged at 6.65-6.75%.

Market participants expect more short-term debt market issuances in the next week as more banks and companies are expected to tap the market to roll over their upcoming maturities, dealers said. 

--Primary market

* SIDBI, Aditya Birla Capital, HDFC Securities, ICICI Home Finance, Godrej Industries, Godrej Properties, and Bajaj Finance raised funds through CPs

* SIDBI, Indian Bank, IDFC First Bank, Punjab National Bank, and Kotak Mahindra Bank raised funds through CD

--Secondary market

* Bank of Baroda's CD maturing on Nov. 3 was traded once at a weighted average yield of 5.7704%

* SIDBI's CP maturing Friday was traded once at a weighted average yield of 5.5001%

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:

End

Edited by Subhojit Sarkar

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