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Informist, Thursday, Dec. 11, 2025

By J. Navya Sruthi

MUMBAI – Yields on three- and five-year corporate bonds rose slightly by 3-4 basis points in the secondary market Thursday, tracking a rise in government bond yields as the rupee fell against the dollar, dealers said. However, they expect a correction Friday as yields on government securities fell later in the day following the Reserve Bank of India's open market operations auction to purchase gilts earlier Thursday. 

At 1306 IST, the yield was 6.6378%, up from the opening of 6.6356%. The rupee fell to a new all-time low of 90.4825 against the dollar, down sharply from 89.97 against a dollar at Wednesday's close. After touching the record low, the domestic currency recovered slightly and ended at 90.3675 a dollar. 

Dealers said mutual funds and banks were major participants in the secondary market and were on the selling side, which also supported yields on corporate bonds. "Trading volumes were primarily concentrated in the medium-term segment, followed by the short-term money market yield and longer-end segments," according to a report by LKP Securities.   

In the secondary market, deals aggregating INR 97.14 billion were recorded on the National Stock Exchange and BSE combined on Thursday, significantly lower than INR 119 billion on Wednesday. Papers issued by the National Bank for Agriculture and Rural Development, Navi Finserv, Bajaj Housing Finance, Keertana Finserv, LIC Housing Finance, UGRO Capital, AYE Finance, Navi Finserv, Krazybee Services, Muthootu Mini Financiers, LIC Housing Finance, Hinduja Leyland Finance, and Bajaj Finance were traded the most on the bourses Thursday.

However, yields on government bonds fell after the cut-off prices at the RBI's OMO auction to purchase gilts. The central bank bought gilts worth the notified amount of INR 500 billion in its OMO purchases. The 10-year benchmark 6.48%, 2035 gilt closed at INR 99.25, or 6.58% yield, against INR 98.93, or 6.63% yield Wednesday. The 6.33%, 2035 gilt ended at INR 98.04, or 6.61% yield, against INR 97.68, or 6.66% yield, in the previous session. The price of the 6.33%, 2035 bond hit a high of INR 98.14 during the day. Dealers expect yields on corporate bonds to also fall slightly Friday, tracking gilts. Market participants await monthly CPI data, due Friday, for more cues.   

In the primary market, companies issued bonds worth over INR 43.85 billion on Thursday, lower than INR 55.20 billion issued Wednesday. Power Grid Corp. of India Ltd. Thursday set a coupon of 7.02% on bonds maturing in 10 years and accepted bids aggregating to INR 37.04 billion. The company had planned to raise INR 25 billion. The issue had a base size of INR 10 billion and a greenshoe option of INR 28 billion.

On Friday, issuances aggregating to INR 84.10 billion are scheduled. HDFC Life Insurance Co. Ltd. will raise up to INR 7.5 billion through Dec. 15, 2035 bonds Friday, and Andhra Pradesh State Beverages Corp. Ltd. will raise INR 57.5 billion through strip bonds. A few other non-banking finance companies will also tap the debt market to raise funds Friday.

UDAY BONDS

In the secondary market, four Ujwal DISCOM Assurance Yojana bonds aggregating to INR 14 million were traded, according to data on the RBI's Negotiated Dealing System-Order Matching system Thursday.

* INR 12.00 million of Andhra Pradesh's 7.35%, 2030 bond was dealt at 6.8794%

* INR 2.00 million of Tamil Nadu's 8.04%, 2029 bond was dealt at 6.3884%

BENCHMARK LEVELS FOR CORPORATE BONDS

End

Edited by Tanima Banerjee

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