HUDCO, PFC, others raise over Rs 10,000 crore via bond sales
The corporate bond market in Mumbai was abuzz with activity on Friday, pulling in an impressive ₹8,441 crore. Leading the charge was HUDCO, which rolled out ₹2,500 crore of 10-year bonds, garnering substantial bids. Meanwhile, the Power Finance Corporation secured funds via 18-month and 5-year bonds, reflecting robust investor confidence.
Mumbai witnessed three significant corporate bond issuances on Friday, raising a combined ₹8,441 crore, as issuers increased borrowing due to lower yields. State-owned HUDCO issued ₹2,500 crore through 10-year bonds, while PFC raised ₹2,968 crore for 18-month bonds and ₹2,973 crore for five-year papers. Additionally, Tata Capital Housing Finance, Nirmal Bang Securities, and other firms issued smaller papers.
The HUDCO 10-year paper was likely presold, with only three major bids received, including LIC and EPFO. The longer tenured paper had a rate below 8%, as it is likely due to the shorter tenure of the bonds. This resulted in a rate of 7.92% for HUDCO's 10-year paper, while PFC's 18-month and 5-year papers had rates of 8.21% and 8.05%, respectively.
HUDCO secured a rate of 7.92% for their 10-year paper, while PFC's 18-month and 5-year papers had rates of 8.21% and 8.05%, respectively. The 10-year benchmark government bond yield increased by 4 basis points, closing at 7.29% on Friday, according to CCIL data. Although the yield has risen slightly from last week's 7.15%, it remains below the 7.50% high seen in October. This softer benchmark yield, coupled with expectations of a rate hike in December, has led to a surge in corporate bond issuances over the past few weeks.
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