Bond market update: Yields steady as markets await GDP data, index inclusion

India’s bond market remained active as states and companies lined up large borrowing plans, while investors tracked key global and domestic triggers.

On the state bond front, nearly ₹5 lakh crore is scheduled to be raised in the current quarter that is January to March. The first round of auctions began today, with nine states set to raise ₹301 billion.

In the secondary market, state-owned banks were active buyers, picking up government securities worth around ₹92.5 billion.

Market participants said the benchmark 10-year gilt yield is expected to trade in a range of 6.60% to 6.66% this week.

Attention is firmly on the upcoming announcement related to the inclusion of Indian bonds in the Bloomberg Global Aggregate Index, expected next week. Markets believe the inclusion is largely priced in and unlikely to pose any issues.

Investor sentiment has also been supported after S&P Global Ratings upgraded India’s long-term sovereign credit rating to BBB in 2025.

Meanwhile, the first advance estimates of GDP for 2025-26 are due on January 7. These numbers are expected to influence movements in both the rupee and the bond market.

On the corporate side, several companies have received board approvals to raise debt. Satin Finserv plans to raise ₹400 million through bonds maturing on July 7, 2027.

Torrent Pharma is seeking approval to raise ₹125 billion through non-convertible debentures (NCDs). REC has approved fundraising of ₹1.55 trillion via NCDs.

JSW Steel has received approval to raise ₹50 billion through NCDs, while Axis Bank plans to raise ₹350 billion through debt. Bank of Maharashtra has approved raising ₹100 billion through infrastructure bonds for FY26.

Separately,

Adani Enterprises

recently launched a ₹1,000 crore bond issue, which was fully subscribed within 45 minutes. The base issue of ₹500 crore was completed in just 10 minutes, reflecting strong demand in the Indian bond market.

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