Informist, Monday, Nov 6, 2023

By Sony 

MUMBAI – Fundraising through commercial papers fell slightly today, with National Bank for Agriculture and Rural Development being the only major issuer, dealers said. So far in the day, companies and financial institutions have raised 22.75 bln rupees through CPs, as compared to 31.5 bln rupees on Friday. NABARD raised 13.75 bln rupees through CPs maturing in three months at 7.26%.  

Money market participants expect issuances of short-term instruments to pick up in the upcoming days, with liquidity in the banking system seen going back to deficit. "Liquidity is in surplus today, but it will fall back into deficit on account of outflows in the form of excise duties and tax deductions," a dealer with a mid-sized brokerage firm said.

Liquidity in the banking system was estimated to be in a surplus of 135.21 bln rupees, as against a deficit of 169.51 bln rupees on Friday. Payment of excise duties and tax deducted at source may wipe out around 500 bln rupees from the systemic liquidity, dealers said. 

Lack of major issuances kept rates on short-term papers flat today, dealers said. Rates on three-month CPs issued by non-banking finance companies were quoted at 7.70-7.90%. Rates on three-month papers issued by manufacturing companies were quoted at 7.35-7.55%.

Rates on three-month certificates of deposit were quoted at 7.25-7.45%. Banks did not issue any CDs today. 

On Friday, Indian Bank raised 25 bln rupees through papers maturing in January at 7.23%.

--Primary market

* NABARD, L&T Metro Rail (Hyderabad), Kotak Securities, and Godrej Industries raised funds through CPs.

--Secondary market
* HDFC Bank's CD maturing on Feb 5 was dealt four times at a weighted average yield of 7.2398%
* Aditya Birla Finance's CP maturing on Tuesday was dealt five times at a weighted average yield of 6.7659%.

At 1700 IST, the following were the volumes, in bln rupees, in the secondary market for short-term debt, as detailed by the Clearing Corp of India's F-TRAC platform:

NOTE: Details of the deals have been received from market sources.

End

Edited by Manisha Baxla

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