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Informist, Friday, Jul. 31, 2026

 

By Vaishali Tyagi

 

NEW DELHI – Yields on corporate bonds ended steady with upward bias after trading in a tight range, dealers said. Selling was seen for most of the day, but it was not strong enough to cause a big move in yield levels, dealers said. Traders turned cautious amid volatile crude oil prices during the day, which swung up and down in a short span and raised investor concerns, while a few traders placed short bets ahead of the weekend on fears of an escalation in the West Asia conflict.

 

Volumes picked up, but flows were largely need-based with limited aggressive bets. The momentum seen yesterday ebbed as traders turned cautious ahead of the weekend, they said. "Not much participation was seen as many participants are a little cautious as they don't know what will happen over the weekend," a dealer at a brokerage firm said. "People remain watchful of international events and the war in the Middle East (West Asia)."

 

Dealers said traders fear what US President Donald Trump will say over the weekend, and what if they take positions today and things completely change over the course of the weekend and in which direction the market will move on Monday. At 1718 IST, Brent crude oil for October delivery was at $88.32 a barrel, up from $86.88 Thursday. 

 

The yield on three-year bonds issued by the National Bank for Agriculture and Rural Development was 7.41-7.44%, broadly unchanged from 7.42-7.45% Thursday. The indicative yield on NABARD's five-year bond was at 7.37–7.42%, similar to 7.38–7.40% the previous day. The indicative yield on NABARD's 10-year bonds remained broadly unchanged at 7.45–7.50% due to subdued activity in the segment. 

 

In the secondary market, deals worth INR 102.89 billion were recorded on the National Stock Exchange and BSE combined, down from INR 120.36 billion Thursday. Papers issued by Tata Capital, L&T Finance, Hyderabad Metropolitan Development Authority, Kerala Infrastructure Investment Fund Board, Small Industries Development Bank of India, Andhra Pradesh State Beverages Corp., and Navi Finserv were actively traded Friday. Mutual funds bought and sold bonds while a handful of banks, insurance companies and companies sold bonds. 

 

Funds raised through corporate bonds rose significantly Friday from Thursday's levels. Bonds worth over INR 70 billion were issued Thursday, higher from INR 41.60 billion on the previous day. UltraTech Cement has raised INR 50 billion through the issuance of three bonds with different maturities. Kotak Mahindra Prime borrowed INR 300 billion, while SMFG India Credit Co. mopped INR 11 billion. 

 

Friday, the primary market had issuances worth over INR 24 billion. Bajaj Housing Finance has invited bids to raise up to INR 20 billion through 10-year bonds, and Edel Finance plans to raise INR 1.15 billion through reissuance of zero-coupon bonds maturing Oct. 19, 2029. Other issuers include Care Health Insurance and Dev Accelerator.  

Going forward, market participants expect activity in the primary market to pick up if crude oil prices remain steady and geopolitical tensions stabilise. In such a scenario, if investors demand higher coupons, it could make borrowing uneasy for issuers, dealers said.

 

On external commercial borrowings, a fund manager said external commercial borrowing flows have slowed a bit. "We saw the queue when it was announced, and at that time spreads over secured overnight financing rate also rose. But we are hearing a few state-owned entities are still in the queue," the fund manager said. "The issue with them is most of them don't have the proper infrastructure in place for it. It will pick up slightly once these (state-owned) companies get their approvals done."   

 

On Jun. 8, the Reserve Bank of India unveiled a concessional swap facility for external commercial borrowings which will remain open up to Jan. 15, 2027, for eligible external commercial borrowings drawdowns made and overseas foreign currency borrowing flows received up to Dec. 31.

 

UDAY BONDS

In the secondary market, no Ujwal DISCOM Assurance Yojana bonds were traded Friday, according to data on the RBI's Negotiated Dealing System-Order Matching System.

 

BENCHMARK LEVELS FOR CORPORATE BONDS:

Tenure	Friday	Thursday
Three-year	7.41-7.44%	7.42-7.45%
Five-year	7.37–7.42%	7.38–7.40%
10-year	7.45–7.50%	7.46–7.51%

 

End

 

Edited by Deepshikha Bhardwaj

 

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