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Informist, Wednesday, Jun. 24, 2026

 

By Nandini Sinha

 

MUMBAI – Yields on corporate bonds across tenures ended lower Wednesday, tracking the fall in yields on Indian government bonds and crude oil prices, dealers said. Paper maturing in up to five years were traded actively. Mutual funds, banks, and insurance companies bought and sold paper as they churned their portfolios.

 

The yields on three-year bonds issued by the National Bank for Agriculture and Rural Development were 7.29-7.32%, down 6-8 basis points from 7.35-7.40% Tuesday. The indicative yields on NABARD's five-year bonds were 7.35-7.40%, down from 7.40-7.45% Tuesday. The indicative yields on NABARD's 10-year bonds were down at 7.45-7.50% from 7.50-7.55% Tuesday. NABARD paper worth INR 14.36 billion was traded Wednesday.

 

The yield on the 10-year benchmark 6.94%, 2036 Indian government bond settled at 6.78% Wednesday, down from 6.84% Tuesday. Gilt yields fell on the belief that the Reserve Bank of India's Monetary Policy Committee will not raise the repo rate in 2026 following comments by Governor Sanjay Malhotra in an interview with ET Now. Malhotra said that it is premature to talk about repo rate hikes in the coming months.

A fall in crude oil prices also supported the fall in government bond and corporate bond yields. At 1729 IST, the Brent crude oil futures contract for August delivery was at $74.72 per barrel, its lowest level since Feb. 27.

 

Bonds aggregating to INR 56.65 billion were issued Wednesday, almost half of Tuesday's issuances worth INR 117.40 billion. Muthoot Finance Ltd. raised INR 15.80 billion through the reissue of its 7.85%, February 2029 bonds, dealers said. Cholamandalam Investment and Finance Co. Ltd. raised INR 20 billion through the issuance of seven-year bonds maturing on Jun. 25, 2033.

In the secondary market, deals aggregating to INR 225.25 billion were recorded on the National Stock Exchange and BSE combined, sharply up from INR 174.95 billion recorded Tuesday.

 

"Banks, mutual funds, insurance companies were both on buying and selling side," a dealer at a broking firm said about the rise in secondary market volume. "They are churning their portfolio."

HDFC Bank Ltd. paper worth INR 12.68 billion and zero-coupon bonds worth INR 11.52 billion from Apex Homes Pvt. Ltd. were traded. So were bonds issued by REC Ltd., HDFC Credila Financial Services Ltd., Hyderabad Metropolitan Development Authority, Power Finance Corp. Ltd., and Bajaj Finance Ltd.

 

Thursday, state-run REC will tap the corporate bond market for the third time in the month to raise a total of INR 60 billion through the issuance of two bonds, including a reissue. It had raised INR 70 billion through the two previous issuances this month.

"Yields (on corporate bonds) have dropped. It's beneficial for them (borrowers) to come now (with issuances)," a dealer at a small finance bank said on REC tapping the market for the third time in June. The state-owned power sector financier plans to raise up to INR 30 billion through the issuance of five-year bonds maturing on Jul. 1, 2031. Market participants expect the cut-off on the bonds to be between 7.20% and 7.25%. REC also plans to raise up to INR 30 billion through the reissue of June 2028 bonds. Both issues have a base size of INR 5 billion and a greenshoe option of INR 25 billion.
 

Other issuers Thursday include Cube Highways Trust, an infrastructure investment trust, which will tap the market to raise INR 6.37 billion through the issuance of bonds maturing in March 2038. Aditya Birla Capital Ltd. will seek bids to raise up to INR 5 billion through the issuance of two bonds--a reissuance and a zero-coupon bond. Toyota Financial Services India Ltd. will seek bids for INR 2.25 billion through the issuance of bonds maturing in June 2028. Navi Finserv Ltd. plans to raise INR 1.5 billion through the reissue of November 2031 bonds while Avanse Financial Services Ltd. has sought bids to raise INR 1 billion through the issuance of bonds maturing in December 2028.

Traders will track developments related to the US-Iran peace talks and the yields on Indian government bonds for the trajectory of corporate bond yields Thursday.

 

UDAY BONDS

In the secondary market, three Ujwal DISCOM Assurance Yojana bonds worth INR 5.50 million were traded Wednesday, according to data on the RBI's Negotiated Dealing System-Order Matching System.

 

* INR 3.00 million of Telangana's 8.04%, 2031 bond was dealt at 7.1658%

* INR 2.00 million of Telangana's 8.75%, 2030 bond was dealt at 7.0005%

* INR 0.50 million of Telangana's 8.77%, 2031 bond was dealt at 7.1856%

 

BENCHMARK LEVELS FOR CORPORATE BONDS: 

 

Tenure	Wednesday	Tuesday
Three-year	7.29-7.32%	7.35-7.40%
Five-year	7.35-7.40%	7.40-7.45%
10-year	7.45-7.50%	7.50-7.55%

 

End

 

US$1 = INR 94.66

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

 

Edited by Rajeev Pai

 

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