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India Corporate Bonds:Ylds steady amid truncated week; volumes tepid

Informist, Monday, Nov 7, 2022

 

By Asmita Patil

 

MUMBAI – Activity in the secondary market of corporate bonds was largely subdued today because of lacklustre trade volumes and volatility in a holiday-truncated week, dealers said. This kept yield movement largely steady in the secondary market.

 

Domestic money markets will remain closed on Tuesday on account of Guru Nanak Jayanti.

 

“People are avoiding large bets at this point in the market because of holiday on Tuesday. Markets are volatile, so people just want to wait and watch for things to settle,” a dealer with a mid-sized brokerage firm said.

 

Activity was thin in the secondary market today with only mutual funds said to have been active to meet their portfolio requirements, dealers said.

 

Minimal investor participation also affected trade volumes. Today, deals aggregating 12.26 bln rupees were recorded on the National Stock Exchange as against 19.78 bln rupees on Friday, while BSE-registered deals worth 13.30 bln rupees, compared with 18.00 bln rupees the previous day.

 

Bonds issued by National Bank for Agriculture and Rural Development, REC, National Highways Infra Trust, Uttar Pradesh Power Corp, Summit Digitel Infrastucture, Tata Power Corp Ltd, Shriram Transport Finance Co, Reliance Industries and Housing Development Finance Corp were traded the most across tenures today.

 

According to dealers, market participants are now awaiting the release of India’s CPI data for the month of October, scheduled on Nov 14.

 

Investors are keeping to the sidelines as they expect Reserve Bank of India to hike rates sharply after the US Federal Reserve Chairman Jerome Powell said rate hikes will be prolonged in the world’s largest economy.

 

While Housing & Urban Development Corp plans to raise up to 15 bln rupees through bonds maturing in February 2026, L&T Finance aims to borrow up to 3 bln rupees through three-year market-linked debentures. Biddings for both the bond offerings is scheduled for Wednesday. 

 

According to merchant bankers, a few state-owned entities and non-banking finance companies are lining up their bond issuances to hit the primary market this week.

 

UDAY BONDS

In the secondary market, Ujwal DISCOM Assurance Yojana bonds aggregating 12 mln rupees were traded at a weighted average yield of 7.66-7.89%, data from Reserve Bank of India’s Negotiated Dealing System – Order Matching System showed.

 

* 9 mln rupees of Uttar Pradesh’s 2028 bond were traded at 7.89%

* 3 mln rupees of Haryana’s 2024 bond were traded at 7.66%

 

BENCHMARK LEVELS FOR CORPORATE BONDS:

TENURES

TODAY

FRIDAY

Three-year

7.55-7.58%7.56-7.58%

Five-year

7.60-7.62%7.60-7.62%

10-year

7.69-7.71%7.70-7.72%

 

Edited by Deepshikha Bhardwaj

 

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

 

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

 

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© Informist Media Pvt. Ltd. 2022. All rights reserved.

Source: Cogencis

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