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Short-Term Debt: HDFC Securities sole issuer of CPs, rates flat

Informist, Monday, Jul 31, 2023


By Asmita Patil


MUMBAI – HDFC Securities was the sole issuer of commercial papers today, raising 2.5 bln rupees through papers maturing in three months at 7.22%, dealers said.


None of the companies or financial institutions raised funds through CPs on Friday. 


Issuances of short-term papers have been lacklustre since the past few days as issuers are waiting for the Reserve Bank of India’s monetary policy decision, dealers said. 


The RBI’s Monetary Policy Committee will announce its policy decision on Aug 10. 


Lack of major activity kept rates on short-term papers flat today. Rates on three-month commercial papers issued by non-banking financial companies were quoted at 7.15-7.35%, while rates on papers of manufacturing companies were at 7.05-7.25%. 


Rates on three-month certificates of deposit were quoted at 6.90-7.10% today. So far today, no bank issued CDs in the primary market.


The rates on short-term papers are seen rising in the face of narrowing liquidity surplus, dealers said. 


Liquidity in the banking system was estimated to be in a surplus of 1.38 trln rupees at the end of trade on Friday, compared with 1.53 trln rupees on Thursday. 


The surplus liquidity fell as banks bolstered their cash balances with the RBI to meet Cash Reserve Ratio requirements on Friday, dealers said.


The fall also was in part due to banks parking nearly 1 trln rupees at the 1.5-trln-rupee, 14-day variable rate reverse repo auction on Friday. 


Lack of major activity also impacted trade volume in the secondary market today. At 1630 IST, CP deals worth 23.45 bln rupees were recorded on the Clearing Corp of India’s F-track platform as against 46.20 bln rupees on Friday. CDs worth 15.65 bln rupees were dealt as against 49.20 bln rupees on Friday. 


–Primary market

* HDFC Securities raised funds through CPs


–Secondary market

* Punjab National Bank’s CD maturing on Aug 9 was dealt thrice at a weighted average yield of 6.8261%

* National Bank for Agriculture and Rural Development’s CP maturing on Aug 21 was dealt six times at a weighted average yield of 6.8507%


At 1630 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.




Edited by Vidhi Verma


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Source: Cogencis

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