Rupee-denominated corporate bond sales rose this week as yields fell on expectation the central bank may abandon its hawkish tone after the Indian economy grew at its slowest pace in more than two years.
India Inc. borrowed a total sum of Rs 11,900 crore this week compared to Rs 5,600 crore that was borrowed last week.
While Standard Chartered expects India's central bank to lower key interest rates by 25 basis points in August, Citi sees a 40 percent chance of an interest rate cut on June 6.
HDFC Ltd. led the borrowing figures this week, tapping the bond market thrice to raise a sum of Rs 2,750 crore. Indian Railway Finance followed suit, raising Rs 2,200 crore via 10-year securities.
The focus this week was on Reliance Communications Ltd. who's rupee bonds were downgraded by credit rating agencies ICRA and CARE Ratings. Fitch also downgraded the bonds citing that a debt default is a real possibility.
Another stock which saw downgrade in bonds was Oriental Bank of Commerce Ltd., who's weak operating and financial performance saw ICRA downgrade its debt.
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