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Informist, Wednesday, Sept. 30, 2026

 

By Vaishali Tyagi

 

NEW DELHI – Yields on corporate bonds maturing in up to three years rose marginally as traders sold bonds amid uncertainty triggered by an intraday rise in Brent crude oil futures, dealers said. The rise in crude was due to uncertainty over US-Iran negotiations. Iranian government spokesperson Fatemeh Mohajerani said Tehran had received a US proposal concerning the reopening of the Strait of Hormuz, following the submission of Iran's own conditions last week.

 

However, yields on bonds with maturities of five years and above remained flat, as traders avoided placing large bets ahead of the Reserve Bank of India's Monetary Policy Committee meeting next week, dealers said. 
 

"There is high uncertainty in the market due to US-Iran talks, which in turn is affecting crude oil prices and making investors cautious before placing fresh bets," a dealer at a brokerage firm said. "It is not just global factors...too many things are overlapping these days. People have to be very calculative before making any moves or taking positions, as things are changing very rapidly."

 

The yield on three-year bonds issued by the National Bank for Agriculture and Rural Development was 7.88-7.90% Wednesday, against 7.86-7.88% Tuesday, while the indicative yield on NABARD's five-year bonds was 7.85-7.87%, similar to 7.86-7.88% Tuesday. The yield on the 10-year NABARD bond was at 7.92% Wednesday.

 

In the secondary market, overall deals worth INR 135.91 billion were recorded on the National Stock Exchange and BSE combined, higher than INR 129.87 billion on Tuesday. Papers issued by IIFL Finance, State Bank of India, Hyderabad Metropolitan Development Authority, Bajaj Finance, Muthoot Finance, Andhra Pradesh State Beverages Corp., Utkarsh Small Finance Bank, Piramal Capital & Housing Finance, HDFC Credila Financial Services, and Tata Capital were actively traded. 

 

On Wednesday too, mutual funds emerged as the most active participants in the corporate debt market on the selling side, dealers said. They are offloading bonds for multiple reasons – first, to free up space in their portfolios to lock in higher-yielding instruments post the MPC meeting, and second, due to month-end redemption pressure, dealers said. With the RBI MPC outcome due on Oct. 7, market participants are anticipating a rate hike in October. 

 

Dealers said some participants sold bonds to participate in the primary market. Banks were seen trading on both the buying and selling sides in low volumes, while activity from insurance companies and pension funds remained low due to subdued action at the longer end of the curve. 

 

In the primary market, corporate bond supply was at INR 145.29 billion Wednesday, higher than INR 104 billion Tuesday. On Wednesday, Reliance Industries raised INR 130 billion through 10-year bonds. Summit Digitel Infrastructure borrowed INR 8.50 billion through floating rate bonds maturing on Sept. 28, 2029. Alphagrep Securities tapped the debt market to raise INR 2 billion through bonds maturing on Oct. 6, 2028. Other issuers included Belstar Microfinance, Creditaccess Grameen, and Regency Fincorp.

 

A few market participants said that even if a rate hike does happen, the rise in corporate bond yields will be limited, as traders have already priced in a 25-basis-point hike. Dealers said the movement will depend on the RBI Governor's commentary. "If there are any negative remarks regarding inflation, it may push yields higher...otherwise, there will not be much impact on yields, as everything is already priced in and yields are already near highs," a fund manger at a mutual fund house said. 

 

On Thursday, issuances worth INR 34.15 billion are scheduled to hit the corporate debt market, significantly lower than the recent primary market volumes, which exceeded INR 100 billion on most days. Both the overall quantum and the number of bonds are substantially lower compared to the previous few sessions

 

Jio Credit plans to raise up to INR 28.50 billion through the issuance of two bonds, while JM Financial Home Loans has invited bids to raise INR 1.25 billion through the issuance of bonds maturing on Dec. 5, 2029. SiCreva Capital Services, Edelweiss Asset Reconstruction Co., and Lendingkart Finance will also tap the market to raise funds.

 

Going forward, non-banking financial companies and banks are expected to increase their issuances to meet capital requirements and fund their disbursals, as credit offtake is likely to pick up in October ahead of the festive season.   

 

BENCHMARK LEVELS FOR CORPORATE BONDS:

 

Tenure	Wednesday	Tuesday
Three-year	7.88-7.90%	7.86-7.88%
Five-year	7.86-7.88%	7.86-7.88%
10-year	7.92%	7.91%

 

UDAY BONDS
In the secondary market, one Ujwal DISCOM Assurance Yojana bond worth INR 8.00 million was traded on Wednesday, according to data on the Reserve Bank of India's Negotiated Dealing System–Order Matching System.

 

* INR 8.00 of Uttar Pradesh's 8.59%, 2030 bond was dealt at 7.3134%

 

End

 

Edited by Avishek Dutta

 

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