New Delhi | April 8, 2025 —
Indian corporates have raised a rare $4.5 billion through bond issuances within the first five trading days of the new fiscal year, marking an aggressive start to FY2025. This bond spree, among the largest early-year debt raises in India’s corporate history, comes amid a notable decline in bond yields, strong liquidity support from the Reserve Bank of India (RBI), and mounting investor demand.
According to data from market sources, yields have fallen by 25–30 basis points on AAA-rated short-term bonds and 20–25 basis points on long-term bonds, enabling issuers to front-load their capital needs at lower costs. Non-banking financial companies (NBFCs) are leading the issuance, focusing on short-term paper, while several state-owned enterprises are locking in longer-term debt at yields below 7%.
This surge in corporate bond activity follows the RBI’s ₹5.2 trillion liquidity injection through government debt purchases and foreign exchange operations. The central bank’s recent 25 basis point rate cut in February and expected additional cuts of up to 75 bps have contributed to the favorable borrowing climate.
Analysts view this as a sign of shifting financial strategy, with companies aiming to pre-emptively manage funding amid equity market volatility and uncertain global cues.
“Corporates are clearly capitalizing on low rates and excess liquidity. The shift reflects a deeper alignment of corporate borrowing with macroeconomic signals,” said a Mumbai-based bond strategist.
With more companies expected to tap the bond markets in the coming weeks, India’s debt capital markets may continue to see heightened activity, shaping a key trend for the year ahead.
