India Corporate Bonds
Yields flat on muted participation in most tenors
This story was originally published at 20:33 IST on 20 April 2026
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By Nandini Sinha
MUMBAI – Yields on corporate bonds were largely steady in most tenors in the secondary market Monday as there were fewer participants in the market, dealers said. Bonds maturing in up to five years were traded the most, they added.
Indicative yields on three-year bonds of the National Bank for Agriculture and Rural Development were steady from the previous day at 7.33-7.38%, dealers said. Yields on five-year bonds of NABARD were 7.50-7.55% on Monday, up from 7.45-7.50% Friday. The yields on 10-year NABARD bonds were unchanged at 7.62-7.67% from Friday. Long-term bonds continue to be less traded due to concerns over inflation and uncertainty over how long the ceasefire between the US and Iran will hold, a dealer from a public sector bank said.
Deals aggregating INR 77.26 billion were recorded in the secondary market on the National Stock Exchange and BSE combined Monday, sharply down from INR 176.82 billion Friday.
Papers issued by LIC Housing Finance Ltd., Power Finance Corp. Ltd., Unigold Finance Ltd., Andhra Pradesh State Beverages Corp. Ltd., Kerala Infrastructure Investment Fund Board, and Hyderabad Metropolitan Development Authority were traded the most.
In the primary market, bond issuances rose to INR 28.05 billion Monday from INR 11.70 billion Friday. On Tuesday, Valencia And Mishal Ventures Pvt. Ltd. plans to raise INR 500 million, HDB Financial Services Ltd. plans to raise up to INR 3 billion, and Keertana Finserv Ltd. plans to raise up to INR 2.5 billion through bond issuances.
NABARD plans to raise up to INR 70 billion Tuesday by reissuing bonds maturing on Jul. 17, 2029. The bonds carry a fixed coupon of 7.44%, payable annually. The cut-off on NABARD's bond reissue is expected to be around 7.50%, according to the dealer at the state-owned bank. "If the NABARD auction is successful, then other players like EXIM (Export-Import Bank of India) and NaBFID (National Bank for Financing Infrastructure and Development) will follow," the dealer from the private sector bank said about bond issuances in the primary market.
Pension funds are expected to pick up pace in purchasing corporate bonds in the first week of May, while insurance companies are expected to start purchasing bonds during the end of April. "It is all based on the nature and the timing of the flows they receive," the dealer said about pension funds and insurance companies.
"Banks continue to have surplus funds with them. Until and unless there is credit offtake, the rates (of the corporate bonds) are going to be at similar levels," a dealer from a private sector bank said. The net liquidity absorbed by the Reserve Bank of India, a proxy of surplus liquidity in the banking system, was INR 4.28 trillion Sunday, up from INR 4.25 trillion Saturday.
UDAY BONDS
No Ujwal DISCOM Assurance Yojana bond was traded Monday, according to data on the RBI's Negotiated Dealing System-Order Matching system.
BENCHMARK LEVELS FOR CORPORATE BONDS:
Tenure | Monday | Friday |
Three-year | 7.33-7.38% | 7.33-7.38% |
Five-year | 7.50-7.55% | 7.45-7.50% |
10-year | 7.62-7.67% | 7.62-7.67% |
End
With inputs from J. Navya Sruthi and Meera Nair
Edited by Deepshikha Bhardwaj
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