Informist, Wednesday, Mar 2, 2022
By Vishal Sangani
MUMBAI – Large issuance by National Bank for Agriculture and Rural Development led to a spike in funds raised through commercial papers today.
Also, a few companies rolled over papers set to mature in the coming days, while others tapped the market to meet fresh requirements for funds.
So far today, CPs aggregating 62.50 bln rupees were issued, as against nil on Monday. NABARD raised 50.00 bln rupees through papers maturing in three month at 4.00%.
The supply of papers by these big-ticket issuers was readily absorbed because of their low-risk profile.
Despite surge in issuances, rates on short-term debt papers were steady because of surplus liquidity in the banking system, dealers said.
Rates on three-month CPs of manufacturing companies were quoted at 4.00-4.15%, while those on papers of non-bank finance companies were quoted at 4.30-4.45%.
Domestic markets were shut on Tuesday on account of Maha Shivratri.
On the other hand, banks did not issue any certificate of deposit today as there is no immediate need for funds owing to surplus liquidity in the banking system.
Liquidity in the banking system is currently estimated to be in a surplus of over 7.75 trln rupees as against 7.36 trln rupees on Monday. The surplus is expected to widen in the coming days on account of inflows due to government spending towards salary and pension payments, dealers said
Rates on three-month CDs were quoted at 3.90-4.10%, in the secondary market.
–Primary market
* Reliance Retail Ventures, Godrej Agrovet and NABARD raised funds through CPs.
–Secondary market
* HDFC Bank’s CD maturing on May 24 was dealt two times at a weighted average yield of 3.8501%
* Tata Power Co’s CP maturing on Mar 3 was dealt at a weighted average yield of 3.3948%
Following were the volumes at 1530 IST in the secondary market for short-term debt, in bln rupees, as detailed by the Clearing Corp of India’s F-TRAC platform:
NOTE: Details of the deals have been received from market sources.
End
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Maheswaran Parameswaran
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