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Informist, Tuesday, May 12, 2026

 

By Nandini Sinha

 

MUMBAI – Yields on corporate bonds ended higher Tuesday, tracking the high crude oil prices and the rise in the yields on government bonds, dealers said. Mutual funds and insurance companies were the most active buyers and sellers of corporate bonds. Papers maturing in up to 15 months were the most actively traded.

 

"In the morning, the rates (yields) were slightly better than yesterday. But later they rose. Bonds maturing in 2026 were around 7-8 bps (basis points) up," a dealer at a private sector bank said. "For the 1-year bonds, there were no deals in the second half... morning it was 1 bp lower. NHB (National Housing Bank) was (traded at) 7.44%, NABARD (National Bank for Agriculture and Rural Development) at 7.52%."

 

In the secondary market, the three-year bonds of the National Bank for Agriculture and Rural Development ended Tuesday at 7.63-7.67%, up from 7.55-7.65% in the previous session, while the five-year NABARD bonds ended at 7.68-7.73% from 7.65-7.70% Monday. The 10-year NABARD bonds were not traded Tuesday. The indicative yield on the 10-year bonds was 7.75-7.80%, compared with 7.75-7.85% Monday, dealers said.

 

"The market sentiment is not good. Even if the g-secs (government securities' yields) didn't rise, with the fall in the rupee, the market is expecting the yields (on corporate bonds) to rise... the sentiment is negative," a dealer at a broking firm said.

 

Market participants are awaiting the results of the bond auction by the National Bank for Financing Infrastructure and Development Wednesday. The state-owned development financial institution plans to raise up to INR 40 billion through 10-year bonds. The cut-off is expected to be 7.70-7.80%, according to market participants. "NaBFID goes higher than NABARD. If pension funds come aggressively, then it (NaBFID) may accept around 7.70-7.76% levels," the dealer at the bank said.

 

Dealers do not expect net inflows from foreign institutional investors to rise in the near term. "There's nothing positive (in the near term). During the MPC (Monetary Policy Committee meeting in April), the volatility was less. Now it's very high. They (FIIs) don't see anything positive currently," the dealer at the bank said. On whether bond issuances could rise, the dealer said, "With the current rates, it's not going to rise. If the rates stabilise, then we could see more issuances."

 

Bonds worth INR 12.38 billion were issued Tuesday, down from INR 136.05 billion of bonds issued Monday. In the secondary market, deals aggregating INR 74.64 billion were recorded on the National Stock Exchange and BSE combined, up from INR 58.94 billion Monday. Among the actively traded bonds were those issued by the Small Industries Development Bank of India and REC. Papers issued by Bajaj Finance, Manipal Education and Medical Group India, Power Finance Corp., and Kerala Infrastructure Investment Fund Board were also actively traded.

 

On Wednesday, Tata Capital Housing Finance plans to raise up to INR 17 billion through three-year bonds, while Aditya Birla Capital has invited bids to raise up to INR 12 billion by reissuing two bonds. Hinduja Leyland Finance has sought bids for its December 2032 bonds to raise INR 1 billion. Globe Capital Market plans to raise INR 3 billion, while Globe Fincap plans to raise INR 2 billion.

 

UDAY BONDS

No Ujwal DISCOM Assurance Yojana bond was traded Tuesday, according to data on the RBI's Negotiated Dealing System-Order Matching system.

 

BENCHMARK LEVELS FOR CORPORATE BONDS:

 

Tenure	Tuesday	Monday
Three-year	7.63-7.67%	7.55-7.65%
Five-year	7.68-7.73%	7.65-7.70%
10-year	7.75-7.80%	7.75-7.85%

 

End

 

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

 

Edited by Saji George Titus

 

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