As on February 2018, 3 months,6 months,12 months NBFC CP yields were at 8%,8.05% and 8.20% levels respectively, yields have come down by 75 bps,40 bps, 40 bps respectively. As on 16th March 2018 CP yields were at 7.25%,7.65% and 7.80% while 3 months,12 months PSU Bank CD yields were at 7.20%,7.58% levels respectively. Yields have come down by 45 bps,28 bps respectively, as on 16th March 2018 CD yields were at 6.75 and 7.30% respectively. During the period Indian bond yields were volatile on concerns of rising inflationary expectations and fiscal slippages. In this volatile period , CPs and CDs offered relative higher yields. Liquidity was comfortable. Liquidity to ease post advance tax outflows in 3rd week of March as MSS bonds of Rs 1 trillion came up for maturity in.RBI is adding Rs 1 trillion through repo and term repo auctions to keep liquidity easy in the system in March.
FII total debt utilisation status stood at 82.35% of total limits. As on 16th March, Corporate bond market trading volumes were 86.61% higher on weekly basis. Commercial Paper (CP) market trading volumes were 42.84% higher week on week and Certificate of Deposits (CD) volumes were 59.07% higher week on week.
Corporate Bonds Traded Levels
Three-year AAA corporate bonds were trading at levels of 7.68% as of week ended on 16th March. Spreads were at 42 bps, 8 bps lower against previous week. Three-year AAA NBFC bonds were trading at levels of 8.10% with spreads at 84 bps levels, 1 bps lower against previous week. Three-year AA+ NBFC bonds were trading at levels of 8.50% with spreads at 125 bps levels.
Five-year AAA corporate bonds were trading at levels of 7.98%. Spreads were at 52 bps,1 bps higher against last week. Five-year AAA NBFC bonds were trading at levels of 8.15% with spreads at 69 bps, 4 bps lower against previous week.
Ten-year AAA corporate bonds were trading at levels of 8.33% with spreads 5 bps higher at 63 bps. Ten-year AAA NBFC bonds were trading at levels of 8.45% with spreads 9 bps higher at 75 bps.
In the week ended 16th March, FIIs were net sellers of INR bonds for around Rs 28.81 billion for the week. Reported corporate bond traded volumes stood at Rs 356.07 billion with daily average volumes of Rs 71.21 billion. Volumes were 86.61% higher compared to the previous week.
CP traded volumes were at Rs 380.06 billion (42.84% higher than previous week) with daily average volumes of Rs 76.01 billion. CD volumes were at Rs 344.01 billion (59.07% higher than previous week) with daily average volumes of Rs 68.80 billion.
Three months and twelve months PSU bank CDs were trading at 6.75% and 7.30% levels each at spreads of 63 bps and 82 bps respectively against T-bill yields. Three months’ maturity Manufacturing and NBFC sector CPs were trading at 6.85% and 7.25% levels respectively. One-year maturity Manufacturing and NBFC sector CPs were trading at 7.57% and 7.80% levels respectively.
As on 16th March, FII debt utilisation status stood at 82.35% of total limits,53 bps lower against the previous week. FII investment position was at Rs 4494 billion in INR debt. FII investment position stands at Rs 2365 billion in gilt securities that also includes investment in Interest Rate Futures and at Rs 2129 billion in corporate bonds.