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Informist, Wednesday, May 13, 2026

 

By Nandini Sinha

 

MUMBAI – Rates on three-year corporate bonds ended higher Wednesday as investors remain cautious over Prime Minister Narendra Modi's appeal to the public to cut down on energy consumption and avoid buying gold, dealers said. Papers maturing in up to four years were the most actively traded. Insurance companies sold papers maturing in 2030, while pension funds bought 10-year bonds. 

 

"Rates were up today because of more uncertainty due to the (US-Iran) war," a dealer at a large public sector bank said. "The market is volatile. Look at what (Prime Minister Narendra) Modi and (US President Donald) Trump have been saying...g-sec (government securities' yields) was also given," a dealer at a broking firm said. The yield on the government bond has ended above 7% levels every day so far this week, compared to 6.98% on Friday.

 

In the secondary market, three-year bonds of the National Bank for Agriculture and Rural Development were dealt around 7.70% Wednesday, up from 7.63-7.67% Tuesday. Dealers were divided over the yields on the five-year bonds. While one said the rates were 4-5 bps higher than 7.68-7.73% Tuesday, the other said the segment was dealt at 7.72% levels. The 10-year NABARD bonds were not traded Wednesday. The indicative rate on the 10-year bonds was around 7.75-7.77%, compared to 7.75-7.80% Tuesday, dealers said.

 

Bonds worth INR 85.05 billion were issued Wednesday, up sharply from INR 12.38 billion of papers issued Tuesday. The National Bank for Financing Infrastructure and Development set a coupon of 7.74% on 10-year bonds at the auction Wednesday. Bonds worth INR 40 billion were fully subscribed, dealers said. According to the bid book accessed by Informist, the specialised development finance institution received 75 bids aggregating INR 76.33 billion in the coupon range of 7.40-7.95%. 

 

In the secondary market, deals aggregating INR 38.97 billion were recorded on the National Stock Exchange and BSE combined at 1500 IST, up from INR 31.15 billion at the same time Tuesday. Volumes have been low due to uncertainty over the US-Iran war, dealers said. "People are in a wait-and-watch mode," a dealer at the state-owned bank said.

 

Among the actively traded bonds, INR 9 billion worth of Bajaj Housing Finance Ltd.'s papers were traded and INR 3.10 billion worth of NABARD's bonds were traded. Papers issued by Sammaan Capital Ltd., Lucina Land Development Ltd., Hyderabad Metropolitan Development Authority and Indian Railway Finance Corp. Ltd. were also actively traded.

 

On Thursday, Globe Capital Market Ltd. will tap the market to raise INR 3 billion. Globe Fincap Ltd. will seek bids to raise INR 2 billion through the issuance of two bonds.

 

Oil marketing companies such as Hindustan Petroleum Corp. Ltd., Indian Oil Corp. Ltd., and ONGC Petro Additions Ltd. raised funds through commercial papers on Tuesday. Traders are of the view that oil marketing companies could also raise funds through corporate bonds. "They (oil marketing companies) are having liquidity issues...they could tap the (corporate bond) market," a dealer at a second state-owned bank said. "That (bond issuance by oil marketing companies) may happen. It is more of a policy decision by the government," a dealer from the first state-owned bank said.

 

After NaBFID, NABARD plans to tap the corporate bond market, dealers said. The state-owned development bank plans to raise up to INR 70 billion through the reissue of the July 2029 bond Friday. 

 

Deals aggregating INR 80.70 billion were recorded on the National Stock Exchange and BSE combined on Wednesday, up from INR 74.64 billion Tuesday.

 

UDAY BONDS

In the secondary market, 10 Ujwal DISCOM Assurance Yojana bonds worth INR 80 million were traded Wednesday, according to data on the RBI's Negotiated Dealing System-Order Matching System.

* INR 25 million of Uttar Pradesh's 8.58%, 2031 bond was dealt at 8.0009%

* INR 19 million of Punjab's 8.61%, 2030 bond was dealt at 7.8991%

* INR 12 million of Uttar Pradesh's 8.77%, 2031 bond was dealt at 7.9998%

* INR 7 million of Tamil Nadu's 8.04%, 2029 bond was dealt at 7.8983%

* INR 5 million of Uttar Pradesh's 8.59%, 2030 bond was dealt at 7.8999%

* INR 3 million of Tamil Nadu's 7.75%, 2032 bond was dealt at 7.8993%

* INR 3 million of Telangana's 8.04%, 2031 bond was dealt at 7.9997%

* INR 2.5 million of Punjab's 8.47%, 2029 bond was dealt at 7.7972%

* INR 2 million of Rajasthan's 8.19%, 2026 bond was dealt at 7.3989%

* INR 1.50 million of Himachal Pradesh's 7.80%, 2027 bond was dealt at 7.8954%

 

BENCHMARK LEVELS FOR CORPORATE BONDS:

 

Tenure	Wednesday	Tuesday
Three-year	7.70%	7.63-7.67%
Five-year	7.72-7.78%	7.68-7.73%
10-year	7.75-7.77	7.75-7.80%

 

End

 

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

 

Edited by Avishek Dutta

 

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