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Informist, Wednesday, Nov. 19, 2025

 

By J. Navya Sruthi and Vaishali Tyagi

 

MUMBAI – Secondary market yields on corporate bonds moved in a narrow range Wednesday and ended steady for the second consecutive day on a lack of fresh cues in domestic and global markets, dealers said. Market participants expect yields to remain rangebound till the Reserve Bank of India's Monetary Policy Committee meeting outcome in the first week of December. 

 

Currently, there are no fresh cues in domestic or global markets for any movement in yields, dealers and fund managers said. "Yields will remain rangebound (moving forward till the MPC outcome in December)," a dealer said. 

 

"The market is divided on the rate cut (in the December meeting). "I personally believe it is (the) best time to cut (rate)... only window left," a fund manager at a mutual fund said.  

 

Market participants believe that December is the "best" time for the RBI to cut rates before inflation starts rising in the subsequent quarters. The RBI has projected CPI inflation to rise to 4.0% in the March quarter  and 4.5% in the first quarter of 2025-26 (Apr-Mar).

 

If the RBI cuts the repo rate in December, yields on two- and three-year bonds are likely to fall more than those on commercial papers and certificates of deposit, the mutual fund manager quoted above said. Yields on the longer-end securities would see only a marginal fall, the fund manager added. 

 

Some dealers, however, expect the Monetary Policy Committee to keep the repo rate unchanged in December, as hopes of an interest rate cut by the US Federal Reserve in the December meeting also fade. According to the CME FedWatch tool, only 48.6% of traders expect a 25-basis-point rate cut by the US Fed in the December meeting, compared with 62.9% a week ago and 93.7% a month ago.

 

On reports of India's likely inclusion in Bloomberg's Global Aggregate Index, the fund manager said the market is still processing the news. If the inclusion happens and there is an impact on government bonds, corporate bonds are likely to follow suit. Business Standard Tuesday reported that foreign portfolio investors gave positive feedback to Bloomberg Index Services on India's bond market operations, and an official announcement is expected as early as January 2026.

 

In the secondary market, deals aggregating to INR 104.00 billion were recorded Wednesday on the National Stock Exchange and BSE combined, higher than INR 91.41 billion Tuesday. While market activity was tepid, mutual funds were active on the buying side and insurance companies on the selling side, dealers said. Banks and other participants remained on the sidelines as there were no new triggers. 

 

Papers issued by Vivriti Capital, Earlysalary Services, REC, HDFC Bank, Vedika Credit Capital, Indian Railway Finance Corp., Krazybee Services, Shri Ram Finance Corp., Akara Capital Advisors, Anand Rathi Global Finance, Indel Money, Keertana Finserv, The Andhra Pradesh Mineral Development Corp., Ambium Finserve, Muthoottu Mini Financiers, LIC Housing Finance, Power Finance Corp., and Hinduja Leyland Finance were traded the most on exchanges Wednesday.

 

In the primary market, companies issued bonds worth INR 26.00 billion Wednesday, higher than INR 10.75 billion Tuesday. Muthoot Finance raised INR 10.60 billion through a reissuance and a fresh issue, sources told Informist. Hero Fincorp raised INR 2.50 billion through bonds maturing Jan. 20, 2031, while Mahindra Rural Housing Finance raised INR 2.50 billion through five-year bonds. 

 

Thursday, issuances aggregating to INR 10.50 billion are scheduled. ICICI Securities plans to raise up to INR 5 billion and Axis Finance plans to raise up to INR 2.50 billion through three-year bonds. Nuvama Wealth and Investment and Sundaram Home Finance have also invited bids to raise funds Thursday.

 

UDAY BONDS

In the secondary market, five Ujwal DISCOM Assurance Yojana bonds aggregating to INR 256.00 million were traded, according to data on the RBI's Negotiated Dealing System-Order Matching system Wednesday.

 

* INR 100.00 million of Tamil Nadu's 7.74%, 2027 bond was dealt at 6.3000%

* INR 50.00 million of Tamil Nadu's 7.75%, 2027 bond was dealt at 6.3000%

* INR 2.00 million of Tamil Nadu's 7.78%, 2031 bond was dealt at 7.1551%

* INR 100.00 million of Andhra Pradesh's 7.35%, 2026 bond was dealt at 6.2000%

* INR 4.00 million of Jammu and Kashmir's 8.48%, 2029 bond was dealt at 6.9840%

 

BENCHMARK LEVELS FOR CORPORATE BONDS

 

Tenure	Wednesday	Tuesday
Three-year	6.72-6.74%	6.72-6.75%
Five-year	6.84-6.86%	6.86-6.87%
10-year	7.14-7.18%	7.14-7.17%

 

End

 

Edited by Saji George Titus

 

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