Indian companies are rushing to raise short-term debt after the central bank's measures to support the rupee triggered a sharp fall in borrowing costs, four merchant bankers said.Companies, led by non-banking financial firms, are raising more than 310 billion rupees ($3.24 billion) through up to five-year bonds this week, the bankers said.
NABARD, another state-run financial institution, raised funds for three years at 7.34% after cancelling a similar issue in May where rates could have touched nearly 8%.Other major non-bank lenders lining up debt sales include Bajaj Finance, Muthoot Finance, Bajaj Housing Finance and L&T Finance, with planned issuances of 85 billion rupees, 27.5 billion rupees, 20 billion rupees and 15 billion rupees, respectively.Despite the recent rally in bonds, investor appetite remains strong on expectations of further gains.
Investors with a more than 18-month investment horizon are looking at corporate bond funds that present an attractive investment opportunity from a relative risk-reward perspective, said Puneet Pal, head of fixed income at PGIM India Asset Management.
