Informist, Friday, May 26, 2023
By Asmita Patil and Parth Singh
MUMBAI – Yields on corporate bonds remained steady across tenures in the secondary market today as investors stayed on the sidelines ahead of buoyant primary supply, scheduled for next week, dealers said.
In the primary market, both India Infrastructure Finance Co Ltd and Performance Chemiserve Ltd plan to raise up to 20 bln rupees through bonds maturing on May 31, 2033, and three-year papers, respectively.
Today, Informist exclusively reported that Housing Development Finance Corp Ltd plans a mega bond sale of 100 bln rupees next week.
According to merchant bankers, some state-owned entities and private lending companies are likely to follow suit with big-ticket issuances next week.
"Surplus liquidity, low rates, and ample demand have led everybody to tap the market now," a senior merchant banker said.
Liquidity in the banking system is currently estimated to be in a surplus of 806.14 bln rupees, up from 496.35 bln rupees on Thursday. The surplus widened due to some inflows on account of government's spending, dealers said.
In the secondary market, insurance companies and mutual funds were active for requirement-based trading, dealers said.
Lack of participation from other investors kept trade volumes low. Today, deals aggregating 40 bln rupees were recorded on the National Stock Exchange and BSE combined as against 88 bln rupees on Thursday.
Bonds issued by Housing Development Finance Corp, REC, Power Finance Corp, National Bank for Agriculture and Rural Development, Sikka Ports Terminals, and Andhra Pradesh State Beverages Corp were traded the most across tenures.
UDAY BONDS
In the secondary market, Ujwal DISCOM Assurance Yojana bonds worth 110.90 mln rupees were traded at a weighted average yield of 6.21-7.42%, according to data from the RBI's Negotiated Dealing System-Order Matching System.
* 9.90 mln rupees of Rajasthan's 2024–26 bonds were traded at 7.35-7.42%
* 100 mln rupees of Tamil Nadu's 2024 bonds were traded at 7.25%
* 1.00 mln rupees of Haryana's 2023 bonds were traded at 6.21%
BENCHMARK LEVELS FOR CORPORATE BONDS:
TENURES | TODAY | THURSDAY |
Three-year | 7.40-7.45% | 7.40-7.44% |
Five-year | 7.40-7.44% | 7.42-7.43% |
10-year | 7.38-7.41% | 7.37-7.40% |
End
Edited by Tanima Banerjee
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