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Informist, Thursday, Jan. 1, 2026

By Vaishali Tyagi

MUMBAI – As the New Year kicked in, corporate bond yields held steady across tenures on Thursday due to muted market participation, dealers said. The market was extremely sluggish, as many participants were on leave because of the New Year, they said. "First day of the year kicked with steady yields. Starting from Christmas, most people were still on leave," a dealer at a mid-sized brokerage firm said. "We expect market activity to pick up next week as participants are expected to return."

On Thursday, mutual funds were active on both buying and selling sides, dealing in papers with maturity of less than five years, dealers said. A few banks also bought papers below the five-year segment. "Apart from mutual funds and a few banks, not many participants were there, long-term investors like insurance companies were absent from the market today (Thursday)," the dealer quoted above said. 

The lack of major participation weighed on trade volumes. Volume fell significantly in the secondary market with deals aggregating to only INR 49.33 billion being recorded on the National Stock Exchange and BSE combined, as against INR 112.82 billion on Wednesday. 

Bonds issued by Kerala Infrastructure Investment Fund Board, IIFL Samasta Finance, Andhra Pradesh State Beverages Corp., Lucina Land Development, National Bank For Agriculture And Rural Development, Adani Enterprises, Vivriti Capital, Akme Fintrade, Earlysalary Services were traded the most on exchanges.

The primary market too remained dull on Thursday with no major deals being reported. Issuances totalling INR 1.10 billion were scheduled for Thursday, lower from INR 14.05 billion Wednesday. On Friday, issuances totalling INR 13.15 billion are scheduled. Aegis Vopak Terminals has invited bids to raise INR 10.30 billion through bonds maturing in three years. Lucina Land Development will also tap the market to raise INR 2.21 billion through bonds. Vedika Credit Capital will issue its bonds to raise INR 750 million on Friday. 

Market participants are preparing for a surge in bond issuances in the primary market during the Jan-Mar period. Typically, companies rush to raise funds through bond sales during the last quarter of the financial year to meet their annual targets. "We think yields will likely move up or down depending on number of issuances in near term. We are expecting a pickup in bond issuances in the last (Jan-Mar) quarter," another dealer at a mid-sized brokerage firm said. "January's going to be a busy month for corporate bonds. Liquidity's expected to improve with RBI's OMO (Reserve Bank of India's open market operations) plans, and companies will probably rush to meet their FY26 fundraising targets."

UDAY BONDS

In the secondary market, one Ujwal DISCOM Assurance Yojana bond worth INR 11.30 million were traded Thursday, according to data on the RBI's Negotiated Dealing System-Order Matching system.

* INR 11.30 million of Telangana's 8.08%, 2029 bond was dealt at a weighted average yield of 6.9254%

BENCHMARK LEVELS FOR CORPORATE BONDS

End

Edited by Tanima Banerjee

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