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India Corporate Bonds: Yields steady, all eyes on HDFC issue Wed

Informist, Tuesday, May 30, 2023


By Parth Singh


NEW DELHI – Yields on corporate bonds ended steady across tenures in the secondary market today as investors await issuances from private financiers on Wednesday, dealers said.


In the primary market, frequent issuer Power Finance Corp raised 25.90 bln rupees through re-issuance of two bonds with different maturities. The state-owned company set a yield of 7.39% on these bonds.


In a mega bond sale, Housing Development Finance Corp Ltd plans to raise up to 100 bln rupees through sale of two-year papers. The lender has been issuing bonds to meet funding needs ahead of its merger with HDFC Bank.


“There was further demand for HDFC issue, but we need to see how much they manage to raise tomorrow,” a merchant banker said. Of the total issue size, 50 bln rupees were underwritten by ICICI Bank.


Investors are of view that the bonds issued by HDFC will fetch them better yields in the secondary market after the merger, dealers said. This expectation is said to help the lender complete its borrowing plan of 570 bln rupees.


Another lender LIC Housing Finance aims to borrow up to 15 bln rupees through re-issuance of bonds maturing on May 16, 2028.


Bidding for both the offerings are scheduled on Wednesday.


According to merchant bankers, a public-sector undertaking is likely to tap the market with a big-ticket issuance this week.


Market participants are also looking forward to India’s GDP data for Jan-Mar, scheduled to be released after market hours on Wednesday. “Market has factored in a positive outcome, so, unless something surprising comes out, we won’t see much reaction,” a bond market veteran said.


According to an Informist poll of 21 economists, India’s GDP growth likely rose to 5.1% in Jan-Mar from 4.4% a quarter ago, mainly due to buoyancy in services activity and uptick in private consumption.


Today, only mutual fund houses and insurance companies were active in the secondary market for their requirement-based trading, dealers said. 


Bonds issued by Housing Development Finance Corp, REC, Indian Railway Finance Corp, Andhra Pradesh State Beverages Corp, Power Finance Corp, National Housing Bank, and Kotak Mahindra Prime were traded the most across tenures.


There was a pick-up in the volumes today. Today, deals aggregating worth 69.51 bln rupees were recorded on the National Stock Exchange and BSE combined as against 46.47 bln rupees on Monday. 



In the secondary market, Ujwal DISCOM Assurance Yojana bonds worth 62 mln rupees were traded at a weighted average yield of 7.24-7.42%, according to data from the RBI’s Negotiated Dealing System-Order Matching System.


* 31 mln rupees of Uttar Pradesh’s 2027–31 bonds were traded at 7.41%

* 20 mln rupees of Rajasthan’s 2026 bond was traded at 7.24%

* 5 mln rupees of Tamil Nadu’s 2029 bond was traded at 7.37%

* 3 mln rupees of Telangana’s 2031 bond was traded at 7.41%

* 3 mln rupees of Punjab’s 2028-29 bonds were traded at 7.36-7.42%















Edited by Maheswaran Parameswaran


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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