Informist, Tuesday, Oct 31, 2023
By Sony
MUMBAI – Funds raised through commercial papers fell today due to a lack of big-ticket issuances by companies and financial institutions, dealers said. So far today, CPs totalling 7.5 bln rupees have been issued, compared with 18.25 bln rupees raised on Monday.
Most of the funds raised through CPs today were for the purpose of rolling over existing debt, dealers said.
Axis Finance became the major issuer of CPs today, raising 2.5 bln rupees through papers maturing in three months at 7.70%.
On Monday, Larsen & Toubro was the major issuer of CPs, raising 13 bln rupees through papers maturing in November at 7.15%.
Rates on short-term debt papers were unchanged due to subdued market participation, dealers said. Rates on three-month CPs issued by non-banking finance companies were quoted at 7.70-7.90%. Rates on similar maturity papers of manufacturing companies were quoted at 7.35-7.55%.
Rates on three-month certificates of deposit were quoted at 7.25-7.45%.
Issuances of certificates of deposit by banks were nil today as the banks were not in immediate need of funds, dealers said.
On Monday, Bank of Baroda raised 26 bln rupees through CDs maturing in three months at 7.27%, and Punjab & Sind Bank raised 5 bln rupees through CDs maturing in three months at 7.44%.
Liquidity in the banking system was estimated to be in a deficit of 1.44 trln rupees, against 1.24 trln rupees on Monday. Dealers expect the deficit to ease in the coming days due to inflows on account of the government’s month-end spending of around 1.5 trln rupees.
The Reserve Bank of India may not allow liquidity to turn into surplus and could announce open market operation sales, dealers said.
–Primary market
* Tata Capital Financial Services, Axis Finance, and ICICI Securities raised funds through CPs.
–Secondary market
* HDFC Bank’s CD maturing on Nov 21 was dealt twice at a weighted average yield of 7.0600%
* Reliance Industries’ CP maturing on Nov 9 was dealt thrice at a weighted average yield of 7.1015%.
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:
Certificates of deposit
Commercial papers
Today
Previous
Today
Previous
28.66
71.6512.7044.10
NOTE: Details of the deals have been received from market sources.
End
Edited by Deepshikha Bhardwaj
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