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Informist, Monday, Nov. 17, 2025

 

By Vaishali Tyagi

 

MUMBAI – Issuances in the short-term debt market fell further Monday due to comfortable liquidity in the banking system, dealers said. Commercial paper issuances fell slightly to INR 18.75 billion from INR 20.25 billion on Friday and there were no certificates of deposit issuances for the second consecutive session.

 

Kotak Securities raised INR 6.5 billion through two CPs and was the largest borrower in the CP market. The company raised INR 6 billion at 6.64% through papers maturing in three months and raised INR 500 million at 6.64% by issuing CP maturing at the start of March. IGH Holdings raised INR 4.25 billion through a three-month paper at 6.85%. Aditya Birla Capital borrowed INR 2 billion at 6.62% through CPs maturing in early March. Other issuers included Pilani Investments, Birla Group Holding, and Aditya Birla Money. These companies cumulatively raised INR 4 billion mostly through CPs of three-month maturity.

 

Dealers said indicative rates on CP remained unchanged Monday as demand from issuers was easily met by investors, which were mainly mutual funds, dealers said. Rates on three-month papers issued by manufacturing companies remained steady at 6.03-6.13%. Rates on papers of similar maturity issued by non-banking finance companies were at 6.63-6.73%, also broadly unchanged from Friday.

 

Ample liquidity surplus and low funding needs kept banks from tapping the certificates of deposit market for the second day in a row. Banks stayed on the sidelines after fulfilling their rollover requirements, dealers said. The central bank's net absorption from the banking system – a proxy for liquidity surplus – was INR 2.40 trillion Friday, largely steady from that on Thursday. This liquidity surplus has been about INR 2 trillion since Nov. 4.

 

Dealers said rates in the short-term debt market remained steady Monday due to low primary issuances as market participants remained on sidelines, engaging only in need-based trades. "There is comfortable liquidity in the system, and at this time there are no specific demand for funds usually...so people are comfortable," a dealer at a brokerage firm said. "Some brokerages and companies are coming but that is based on their requirement...now we expect issuance to pick up towards the end of this month."

 

Dealers said indicative rates on CDs remained largely unchanged. Indicative rates on three-month CDs were 6.00-6.08% compared with 5.99-6.07% Friday. Yields on six-month and one-year CDs also remained unchanged at 6.20–6.25% and 6.42–6.47%, respectively.

 

In the secondary market of short-term debt, most of the activity was concentrated on papers maturing in January and February. Total INR 80.55 billion of CDs were traded in the secondary market, against INR 75.90 billion Friday. In the case of CPs, the turnover was INR 48.25 billion, down from INR 67.40 billion Friday.

 

--Primary market

* Kotak Securities, Pilani Investments, Birla Group Holding, IGH Holdings, Aditya Birla Money, Aditya Birla Capital, ICICI Securities raised funds through CPs

* None of the banks raised funds through CDs

 

--Secondary market

* Axis Bank's CD maturing on Tuesday was traded five times at a weighted average yield of 5.3020%

* Tata Teleservices Maharashtra's CP maturing Monday was traded thrice at a weighted average yield of 5.3942%

 

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:

 

Certificates of deposit		Commercial paper
Monday	Friday	Monday	Friday
80.55	75.90	48.25	67.40

 

End

 

Edited by Ashish Shirke

 

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