Corp bond dues soar 4x to Rs 40.2 lakh crore in a decade

MUMBAI: Illiquidity in secondary company debt market is a world situation and so focus must be on additional deepening main market that has grown practically four-folds in a decade to over Rs 40 lakh crore, an RBI official stated.
RBI deputy governor T Rabi Sankar stated concerted efforts by regulators and authorities have seen company bond excellent touching Rs 40.2 lakh crore in FY22 from Rs 10.5 lakh crore in FY12. Whereas annual issuances throughout this era have elevated from Rs 3.8 lakh crore to shut to Rs 6 lakh crore. He was addressing a Bombay Chamber of Commerce & Business occasion right here on Wednesday.
Throughout this era, the secondary market quantity spiked from Rs 4.5 lakh crore to Rs 14.4 lakh crore, exhibiting clearly that secondary buying and selling has not risen in consonance with the dimensions of the market, he stated. Nevertheless, as of finish June 2022, the excellent quantity slipped to Rs 39.6 lakh crore throughout 29,745 excellent devices. Sankar stated the rising dimension of the company bond market and the variety of issuances yearly (5,400 in FY22) are essential indicators of the success of growth efforts of the federal government and regulators.
On the dominance of personal placement of debt points within the nation, he stated this is without doubt one of the primary causes for the low depth of the secondary market.
In FY12, of the overall round Rs 4 lakh crore issuance, public points constituted solely round 2%. And the development has not moved since then although the overall issuances have been rising which peaked at over Rs 8 lakh crore in FY21. For example in FY22, cash raised by public issuances was simply Rs 11,589 crore, which is nearly 2% and the remaining Rs 5.9 lakh crore had been non-public placements, he stated. Stating that solely the US has a really liquid secondary company bond market, he stated India is the second finest, which although may be very low.