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Informist, Tuesday, Feb. 24, 2026

By Vaishali Tyagi

NEW DELHI – Corporate bond yields were steady in secondary market Tuesday, with traders focussing on requirement-based trades, dealers said. However, volume in the secondary market significantly rose compared with the previous session due to comfortable liquidity in the banking system, they said. 

In the secondary market, deals aggregating to INR 127.13 billion were recorded on the National Stock Exchange and BSE combined Tuesday, from INR 80.51 billion Monday. Mutual funds and banks sold and bought bonds across tenures. Insurance companies and pension funds were seen buying and selling bonds in low volumes. 

Further, dealers said market participants have shifted focus to the primary market, where key state-owned entities are set to raise funds. More issuances are expected in the near term, dealers said. Merchant bankers believe activity in the primary market will continue to rise, driven by slight fall in yields and increased investor appetite amid good liquidity in the banking system. 

According to latest data, the net liquidity absorbed from the banking system by the RBI--a proxy for the liquidity surplus--was INR 1.93 trillion Monday, up from INR 1.74 trillion Sunday. 

Bond issuances in the primary market rose to INR 18.50 billion on Tuesday from INR 7.6 billion Monday. Wednesday, issuances aggregating to INR 40.60 billion are scheduled. NHPC Ltd. plans to raise up to INR 20.0 billion by issuing 15-year bonds maturing on Feb. 27, 2041. The bonds carry a separately transferable redeemable principal part structure, in which the principal and coupon payments are stripped and sold separately to investors. Dealers expect coupon on the bonds to come around 7.25% and expect strong reponse to the bond issuance. "Issuances from state-owned agencies which are also 'AAA' rated usually see good response from market as people wait for such issuances...these days, liquidity is also good which is also a reason to receive well bids tomorrow (Wednesday)," a dealer at a brokerage firm said. 

Sundaram Finance Ltd. plans to raise up to INR 10 billion through bonds maturing on Feb. 14, 2028. InCred Financial Services Ltd. plans to raise up to INR 2.00 billion by issuing two-year one-month bonds maturing on Mar. 6, 2028. Other issuers include Profectus Capital, Finkurve Financial Services, and Sammaan Capital.

"There is good liquidity in the system and yields are also stable with minor fluctuation," a dealer at a brokerage firm said. "Traders are participating in the secondary market based on their requirements, but we expect robust activity in the primary market this week with several issuances already scheduled," the dealer quoted above said.

Papers issued by Cholamandalam Investment and Finance Co., Housing And Urban Development Corp., National Highways Authority of India, Indian Overseas Bank, Andhra Pradesh State Beverages Corp., Aditya Birla Sun Life Insurance Co., Kerala Infrastructure Investment Fund Board, Andhra Pradesh State Beverages Corp. and IIFL Finance were traded the most on exchanges Tuesday. 

UDAY BONDS

In the secondary market, five Ujwal DISCOM Assurance Yojana bonds worth INR 159.80 million were traded Tuesday, according to data on the RBI's Negotiated Dealing System-Order Matching system.

* INR 150.00 million of Uttar Pradesh's 8.71%, 2028 bond was dealt at 6.7200%

* INR 5.30 million of Haryana's 8.18%, 2026 bond was dealt at 5.3839%

* INR 2.00 million of Uttar Pradesh's 8.14%, 2026 bond was dealt at 5.1061% 

* INR 1.50 million of Andhra Pradesh's 7.35%, 2030 bond was dealt at 7.1004% 

* INR 1.00 million of Punjab's 8.47%, 2029 bond was dealt at 6.6531%

BENCHMARK LEVELS FOR CORPORATE BONDS

End

With inputs from Aaryan Khanna

Edited by Akul Nishant Akhoury

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