Trading in corporate bonds at India's capital markets moved closer to the Rs 10 lakh crore level in the just ended fiscal 2013-14 (FY14).
According to the latest data from market watchdog Securities and Exchange Board of India (Sebi), trading in bonds worth a total of Rs 9.70 lakh crore was reported on National Stock Exchange (NSE), Bombay Stock Exchange (BSE) and the Fixed Income Money Market and Derivatives Association of India (FIMMDA) in 2013-14.
This amount is 31.4 per cent higher than Rs 7.38 lakh crore recorded in the previous fiscal year (2012-13).
In 2007-08, trading in corporate bonds was worth just about Rs 95,889 crore.
Corporate bonds are debt securities issued by private and public companies to raise money for a variety of purposes, such as building a new plant, purchasing equipment, or growing the business. They return the money, along with the interest, borrowed against the bonds on a specified maturity date.
The bonds tend to rise in value when interest rates fall, and they fall in value when interest rates rise. Longer the maturity, the greater is the degree of price volatility.
In 2013-14, the maximum trades in corporate bonds worth Rs 5.92 lakh crore were reported on FIMMDA.
Trades amounting to Rs 2.75 lakh crore and little over Rs 1 lakh crore were reported on NSE and the BSE respectively, in FY14.
Corporate bonds witnessed maximum trading in May, 2013 (Rs 1.22 lakh crore) followed by Rs 1.11 lakh crore in April and July. Lowest number of trades amounting to Rs 45,755 crore took place in February, this year.
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