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Informist, Tuesday, Jun. 16, 2026

 

By Vaishali Tyagi

 

NEW DELHI – Corporate bond yields ended steady Tuesday after moving in a narrow range for most of the day as traders turned their attention to primary issuances, particularly from public sector undertakings and an infrastructure finance company, dealers said. Secondary market activity remained limited to portfolio churning, with traders across all segments offloading long tenor bonds from their holdings, keeping yields largely unchanged.

 

Earlier in the day, buying demand from mutual funds and banks led to a marginal decline in yields on short-term bonds maturing in up to three years. However, selling pressure from a few mutual funds and insurance companies pushed levels back to previous levels, dealers said. "Secondary market activity was thin today even though volume is higher, but that was in bits and pieces with trades driven mostly by portfolio-specific needs," a dealer at a brokerage firm said. "As primary market bidding picked up, attention moved there."

 

The yield on three-year bonds issued by the National Bank for Agriculture and Rural Development was 7.34-7.36%, largely unchanged from Friday's 7.35-7.37%, while the yields on NABARD's five-year bonds were 7.38-7.40%, also broadly steady from 7.37-7.39% Friday. The indicative yields on NABARD's 10-year bonds were at 7.54-7.56%. 

 

Dealers said trading volumes in the secondary market were slightly higher on Tuesday, with a few good deals executed in the closing hours, including a good amount of buying and selling by mutual funds. "Some large investors freed up capacity to take part in the primary market given the big issuances today (Tuesday)," the dealer quoted above said. "Investors usually wait for such quality papers to add to their portfolios," the same dealer said.

 

In the secondary market, deals aggregating to INR 144.96 billion were recorded on the National Stock Exchange and BSE combined on Tuesday, significantly higher than INR 99.82 billion on Monday. Mutual funds and banks were actively buying and selling papers across various tenures, with a more pronounced activity in shorter-tenure papers. Companies were active in the secondary market to trade bonds. A few insurance companies were also active in buying and selling bonds. 

 

Papers issued by Small Industries Development Bank of India, Keertana Finserv, Andhra Pradesh State Beverages Corp., Muthoot Fincorp, Adani Airport Holdings, Tata Capital Housing Finance, Telangana State Industrial Infrastructure Corp. and Bajaj Housing Finance were traded the most on bourses on Tuesday. 

 

Tuesday, the primary market saw bond issuances totalling INR 125.50 billion. Three state-owned companies raised INR 121.40 billion, while an infrastructure finance company mopped up INR 4.10 billion. Small Industries Development Bank of India raised INR 60 billion through five-year bonds maturing on Jun. 18, 2031, at a 7.40% coupon. The issue was fully subscribed. Market participants had expected SIDBI's 2031 bond issue to be priced at 7.40-7.45%, while a SIDBI official had pencilled in a cut-off of 7.25-7.35%.

 

State-owned REC also tapped the market, raising INR 40 billion through bonds maturing Jul. 1, 2036, at a coupon of 7.46%. REC's issue was also fully subscribed. Housing and Urban Development Corp. raised INR 21.40 billion via bonds maturing on Jul. 18, 2029, at a coupon of 7.23%. NIIF Infrastructure Finance raised INR 4.10 billion through bonds maturing on Aug. 21, 2029, at a coupon of 7.88%

 

Wednesday, issuances aggregating to INR 55.35 billion are in line to raise funds from the corporate debt market. Tata Capital Housing Finance has invited bids to raise up to INR 20 billion by issuing bonds maturing on Jun. 18, 2030, while Mahindra and Mahindra Financial Services plans to raise up to INR 10 billion through bonds maturing on Jun. 18, 2029. Bajaj Finance, Nuvama Wealth Finance, and Keertana Finserv will also tap the market to raise funds.

 

Dealers expect a pickup in primary market activity in the near term if yields remain stable or fall further. "Some big issuances have happened already and we may expect some more top-rated NBFCs to tap the market, seeing the rates... in fact, we may see some more big names to follow suit if yields stay on the lower side, especially other PSUs may come," a dealer at another brokerage firm said.   

 

UDAY BONDS

In the secondary market, five Ujwal DISCOM Assurance Yojana bonds worth INR 302.00 million were traded Tuesday, according to data on the RBI's Negotiated Dealing System-Order Matching System.

* INR 100 million of Andhra Pradesh's 7.35%, 2026 bond was dealt at 6.2001%

* INR 100 million of Tamil Nadu's 7.74%, 2027 bond was dealt at 6.3001%

* INR 50 million of Tamil Nadu's 7.75%, 2027 bond was dealt at 6.3000%

* INR 50 million of Tamil Nadu's 7.90%, 2027 bond was dealt at 6.3001%

* INR 2 million of Telangana's 8.04%, 2031 bond was dealt at 7.1839%

 

BENCHMARK LEVELS FOR CORPORATE BONDS: 

Tenure	Tuesday	Monday
Three-year	7.34-7.36%	7.35-7.37%
Five-year	7.38-7.40%	7.37-7.39%
10-year	7.54-7.56%	7.55-7.58%

 

End

 

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

 

Edited by Saji George Titus

 

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