Millennium Post

India Inc’s Q4 bond sales up 30% to $15 bn

This is the highest bond sale in the quarter under review since 2013 when companies had scooped up a whopping $21.4 billion in debt. Of the total pie, offshore US dollar-denominated bond market reached the $3.1 billion mark during the reporting period, a 52.6 per cent increase from a year earlier. In terms of number of issuance, the same doubled, according to Thomson Reuters data.

Reliance Industries led the pack with a 10-year US dollar bond, raising $990 million at 4.125 per cent rate in January. A few weeks later, RIL raised $741.5 million more from a 30-year US-dollar bond sale. At $10.8 billion, the financial sector accounted for 72 per cent market share during the quarter in question, a 34.5 per cent jump in proceeds as against the first quarter of 2014. Out of the total the rupee bonds dominated the scene with Power Finance Corp raising Rs 4,440 crore, Rural Electrification Corp Rs 2325 crore and Power Grid Corp 2580 crore.

In total the rupee-denominated bonds touched Rs 76,820 crore in the January-March quarter, up 33.3 per cent compared to the same period last year when it had stood at Rs 57630 crore. This is the highest first quarter period since 2013 when proceeds reached a record high of Rs 85,760 crore. The financials sector accounted for 77.4 per cent of the rupee bonds market with Rs 59,470 crore, which was a 64 percent in increase from a year ago period when it had stood at Rs 36260 crore. Issuance from energy & power firms with Rs 8680 crore, increased 103.6 percent compared to the quarter last year, accounting for 11.3 percent of the market share.

Axis Bank topped the ranking in underwriting, with related proceeds of $2.3 billion from 49 deals, accounting for 15.3 percent market share. However, in terms of fees, Citi took the lead with $3.4 million of the total fees of $23.1 million, which rose 87.3 percent year-on-year.

MFs’ debt market investments soar 8% to RS 6 trillion in FY15

Mutual fund managers pumped in nearly Rs 6 trillion in debt market in 2014-15, an increase of eight per cent from the preceding year, primarily on account of improved business sentiments. Besides, fund managers invested a net amount of Rs 40,000 crore in equity markets during last financial year.

Moreover, mutual fund houses are upbeat about overall inflows in equities and debt markets for the current financial year (2015-16) as well. Industry experts have attributed the inflows in debt markets during 2014-15 to the new government’s reforms agenda, improved fundamentals of the domestic economy and increased participation from retail investors. However, industry body Association of Mutual Funds of India’s (Amfi) decision to put one per cent cap on upfront commission paid to distributors may impact the sector, they added.

As per data released by the capital markets regulator, Securities and Exchange Board of India (Sebi), mutual fund managers invested a net sum of Rs 5.87 trillion in 2014-15, higher than Rs 5.43 trillion pumped in the preceding year. This inflow has helped the mutual fund industry to reach around Rs 12 lakh crore mark in assets under management (AUM) at the end of the financial year.

In comparison, Foreign Institutional Investors (FIIs) made a net investment of Rs 1.64 lakh crore into debt markets during the period under review.

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