Bond trading gains traction;logs over Rs 83Kcr turnover in Jul

Aug 24 2014, 11:43 IST
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SummaryDealings worth a total of Rs 68,381.37 crore in corporate bonds was reported on the two bourses during June.

Trading in corporate bonds at the nation's top stock exchanges -- BSE and NSE -- picked up by 22.3 per cent at about Rs 83,612 crore in July over the preceding month, latest data by market regulator Sebi showed.

Dealings worth a total of Rs 68,381.37 crore in corporate bonds was reported on the two bourses during June.

The Rs 83,611.81 crore trading in July was the second highest for a month after Rs 93,946 crore in May in the current fiscal 2014-15.

However, the value in July 2014 was 24.45 per cent lower than Rs 1.10 lakh crore witnessed in the same month last year.

Including July, the total trading in corporate bonds has touched nearly 3.21 lakh crore in this fiscal. In the same period last fiscal, the value of corporate bond transactions stood at over Rs 4.30 lakh crore.

During July this year, National Stock Exchange (NSE) represented the largest share of trading in corporate bonds (about 80 per cent). Bond trading worth Rs 66,854 crore were reported on NSE this month.

Trades in bonds amounting to Rs 16,757.8 crore were seen on the BSE last month.

For April-July period, NSE reported Rs 2.61 lakh crore trades in bonds, while BSE and Fixed Income Money Market and Derivatives Association of India (FIMMDA) reported a trading of over Rs 60,086 crore and Rs 31 lakh, respectively.

FIMMDA is an association of scheduled commercial banks, public financial institutions, primary dealers and insurance companies. The reporting platform at FIMMDA began on September 1, 2007 and allows entities to report their deals in bonds in one platform.

For July, FIMMDA did not report any trading in bonds.

Corporate bonds or debt securities are issued by private and public firms to raise money for a various purposes like building a new plant, purchasing equipment or business growth.

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 on a specified maturity date.

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