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Saturday, February 4, 2023

Short-Term Debt: Rates on CPs, CDs down as liquidity in surplus

Informist, Tuesday, Nov 29, 2022


By Vishal Sangani


MUMBAI – Rates on short-term debt papers such as commercial papers and certificates of deposit fell because of surplus liquidity in the banking system, dealers said.


Liquidity in the banking system is estimated to be in a surplus of 287.88 bln rupeesagainst 288.33 bln rupees on Monday. The surplus may widen in the coming days due to inflow on account of the government’s month-end spending in the form of salaries and pension payouts, dealers said.


Rates on three-month CPs issued by non-banking finance companies were down at 7.15-7.35% from 7.20-7.45% on Monday, while rates on papers of manufacturing companies were flat at 6.90-7.10% due to lower issuances.


Rates on three-month CDs were down at 6.80-7.05% compared with 6.85-7.10% on Monday.


Funds raised through CPs fell today in the absence of big-ticket issuances, dealers said.


On Monday, Reliance Jio Infocomm and Larsen & Toubro had raised 50 bln rupee in total through CPs.


Kotak Securities was the lone issuer of CPs today, raising 1 bln rupees at 7.17% through papers maturing on Feb 20. On Monday, companies had raised 61 bln rupees through CPs.


Supply of CPs also fell as some companies stayed on the sidelines due to low requirement for funds, and as some companies rolled over papers set to mature in the next few days.


Meanwhile, Axis Bank and Small Industries Development Bank of India together raised 17.00 bln rupees at 7.32% and 7.60% through papers maturing on Jun 22 and Feb 14, 2024, respectively.


On Monday, Bank of Baroda was the lone issuer, raising 30 bln rupees through CDs.


–Secondary market

* Small Industries Development Bank of India’s CD maturing on Feb 14 was dealt at a weighted average yield of 6.7801%

* National Bank for Agriculture and Rural Development’s CP maturing on Dec 15 was dealt four times at a weighted average yield of 6.1989%


At 1530 IST, 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







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




IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT


Edited by Avishek Dutta


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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Source: Cogencis

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