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Informist, Wednesday, Feb. 25, 2026

By Vaishali Tyagi

NEW DELHI – Corporate bond yields in the secondary market ended broadly steady Wednesday as traders sold and purchased bonds to adjust their portfolios, dealers said. Traders continued to reshuffle their portfolios owing to the lack of fresh domestic or global triggers, dealers said, removing short-duration paper and adding long-term bonds.

"Some long-duration mutual funds were present who changed their positions... by selling 2027 and 2028 segment bonds and buying beyond 2033 maturity bonds," a fund manager at a mutual fund house said.

"Trading activity was moderate with dealers across segments actively swapping bonds to meet their needs," a dealer at a broking firm said. "As demand was largely matched by supply, yields remained flat without any broad movement... 1-2 bps (basis points) up or down because of few trades is normal, but overall it was steady."

Merchant bankers expect yields to rise across tenures in the near term as investors sell low-yielding bonds to make room for new issuances. Traders are also offloading illiquid bonds, they said.

The volume of trades in the secondary market was higher with deals aggregating to INR 141.59 billion being recorded on the National Stock Exchange and BSE combined, against INR 127.13 billion Tuesday. Mutual funds were said to be aggressively selling and buying bonds across tenures for portfolio requirement, dealers said. Insurance companies were net buyers of longer-tenure bonds. Other participants such as pension funds and a handful of banks and companies sold and bought bonds across tenures, as per the dealers.

Paper issued by Tata Capital Financial Services, LIC Housing Finance, Kotak Mahindra Investments, Vivriti Capital, UGRO Capital, Mahindra & Mahindra Financial Services, Midland Microfin, and Power Finance Corp. were traded the most Wednesday.

In the primary market, bond issuances rose to INR 40.60 billion from INR 18.50 billion Tuesday. NHPC raised INR 20 billion at a coupon of 7.29% through a 15-year bond maturing on Feb. 27, 2041. The bond has a separately transferable redeemable principal part structure, in which the principal and coupon payments are stripped and sold separately to investors. Dealers said NHPC's issuance got fine levels as the market was expecting a separately transferable redeemable principal part structure bond. "Pension funds and EPFO (Employees' Provident Fund Organisation) were there to participate," the dealer quoted above said.

Thursday, issuances aggregating to nearly INR 90 billion are scheduled. Canara Bank plans to raise up to INR 50 billion by issuing a 10-year Basel-III-compliant additional tier-II bond maturing on Feb. 27, 2036. Dealers expect the bank's coupon to be in the range of 7.40-7.45%. Cholamandalam Investment and Finance Co. plans to raise up to INR 15.00 billion by reissuing a bond maturing on Mar. 5, 2029. Embassy Office Parks REIT has invited bids to raise up to INR 14 billion through a 10-year bond maturing on Feb. 27, 2036. Other key issuers include EarlySalary Services, Aditya Birla Capital, and PNB Housing Finance.

UDAY BONDS

In the secondary market, five Ujwal DISCOM Assurance Yojana bonds worth INR 28.00 million were traded Wednesday, according to data on the RBI's Negotiated Dealing System-Order Matching system.

* INR 20.00 million of Uttar Pradesh's 8.49%, 2030 bond was dealt at 7.2024%

* INR 3.00 million of Tamil Nadu's 7.70%, 2032 bond was dealt at 7.3334%

* INR 2.00 million of Uttar Pradesh's 8.14%, 2026 bond was dealt at 5.0369% 

* INR 2.00 million of Tamil Nadu's 7.72%, 2032 bond was dealt at 7.3325% 

* INR 1.00 million of Punjab's 8.47%, 2029 bond was dealt at 6.6482%

BENCHMARK LEVELS FOR CORPORATE BONDS

End

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

With inputs from Aaryan Khanna

Edited by Rajeev Pai

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