The trading in corporate debt securities at leading stock exchanges NSE and BSE has surged 66.5 per cent to a record Rs 4.34 lakh crore during the first quarter of the current fiscal, according to official data. Trading worth Rs 2.61 lakh crore in corporate bonds was seen on the two bourses during April-June period of 2016-17, as per the data compiled by capital market regulator Sebi. During the first quarter of 2017-18, the National Stock Exchange (NSE) represented the largest share of trading in corporate bonds at over 70 per cent. In the period under review, Bonds worth Rs 3.12 lakh crore were traded on the exchange. The stock exchange had witnessed trades amounting to Rs 2.10 lakh crore in the first quarter of the last fiscal.
The remainder of the bonds worth Rs 1.22 lakh crore were traded on the BSE during the first quarter of the current fiscal — more than double the amount recorded in the same period year-ago. During the current fiscal, June recorded the highest value in terms of trading in corporate debt at Rs 1.69 lakh crore. Bond transactions worth Rs 96,948.64 crore took place in the same month during the previous fiscal.
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In April this fiscal, Rs 1.39 lakh crore worth of trading was reported while in May it was nearly Rs 1.26 lakh. Corporate bonds or debt securities issues are increasingly becoming a preferred route for companies to raise funds for various business purposes. like building a new plant or purchasing equipment. When an entity buys a bond, one lends money to the firm that issued the security and in exchange, the company promises to return the money with interest on a specified maturity date.