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Informist, Tuesday, Aug. 4, 2026

 

By Nandini Sinha

MUMBAI – Yields on corporate bonds ended a tad higher Tuesday after a volatile trade, with active participation from various market participants, dealers said. "It was a mixed market today," a dealer at a state-owned bank said. "Banks were buying as well as selling (corporate bonds)." Insurance companies were also seen buying corporate bonds, while mutual funds were actively buying and selling papers.

 

While the yields on corporate bonds remained steady from Monday's levels in early trade, they rose two-three basis points after the National Bank for Agriculture and Rural Development withdrew its issue of September 2031 bonds. Towards the end of trade hours, secondary market yields came back to the levels seen early morning. However, the fall was limited due to selling by some mutual funds on redemption pressure towards the end.

 

The yield on three-year bonds issued by the National Bank for Agriculture and Rural Development was 7.42–7.44%, up 2 bps from 7.40-7.42% Monday. The indicative yield on NABARD's five-year bonds was at 7.42–7.44% against 7.38–7.44% Monday, while that on NABARD's 10-year bonds was 7.50-7.52% from 7.45–7.50% Monday. 

 

Bonds worth INR 84 billion were issued Tuesday. NABARD, the biggest issuer slated for the day, withdrew its issue of bonds maturing on Sept. 17, 2031, as investors demanded higher coupon, dealers said. The company had planned to raise up to INR 80 billion through the issuance, with the base size at INR 20 billion and greenshoe of INR 60 billion.

 

After the withdrawal, mutual funds actively bought NABARD's 2028 bonds in the secondary market, a dealer at a brokerage firm said. NABARD's 7.48%, September 2028 bonds, worth INR 5.2 billion were dealt at a yield of 7.40%. 

 

In the secondary market, deals worth INR 139.14 billion were recorded on the National Stock Exchange and BSE combined, sharply up from INR 101.72 billion Monday. Papers issued by Sundaram Home Finance, NABARD, Bajaj Finance, Tapir Constructions, and National Bank for Financing Infrastructure and Development were actively traded.

 

On Wednesday, HDB Financial Services plans to raise up to INR 10 billion through the reissue of the 8.23%, July 2029 bonds, dealers said. Lloyds Metals and Energy has sought bids for INR 7 billion through the issuance of 10-year bonds. Equinox India Infraestate will seek bids for INR 1.9 billion through the reissue of the 13.50%, March 2031 bonds. 

 

Market participants await the Reserve Bank of India's Monetary Policy Committee's decision on the rate hike Wednesday. While market participants do not expect a rate hike this time, they will watch out for the governor's statement for further cues. "Don't expect much impact of it (MPC's decision on policy repo rate) on corporate bonds," the dealer at the state-owned bank said. 

 

UDAY BONDS

In the secondary market, one Ujwal DISCOM Assurance Yojana bond worth INR 3.00 million was traded Tuesday, according to data on the RBI's Negotiated Dealing System-Order Matching System.

 

* INR 3.00 million of Uttar Pradesh's 8.44%, 2029 bond was dealt at 8.3465%.

 

BENCHMARK LEVELS FOR CORPORATE BONDS:

Tenure	Tuesday	Monday
Three-year	7.42–7.44%	7.40-7.42%
Five-year	7.42–7.44%	7.38–7.44%
10-year	7.50-7.52%	7.45–7.50%

 

End

 

Edited by Deepshikha Bhardwaj

 

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