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Time of India
11-07-2025
- Business
- Time of India
NSE, BSE issue advisory to bond investors. Here are 10 things to know
Stock exchanges BSE and NSE on Friday issued an advisory to investors dealing with Online Bond Platform Providers (OBPPs) to explain to them the underlying features of bonds, risks and costs associated with such investments, in order to help them make informed decisions. In a joint press release issued today, the exchanges said that it is crucial to understand the concepts of the bond markets including the factors affecting the yield of the bonds. The release was issued amid a growing popularity of online bond platforms and easier access to investors to various fixed-income instruments. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Here's Why This 1 Day Garage Floor Coating Is Sweeping Texas Garage Flooring USA Learn More Undo 10 things to know: 1) Yield to Maturity (YTM): One of the most important concepts to understand is the YTM, which represents the total annualized return an investor can expect if the bond is held until its maturity. YTM takes into account the bond's current market price, its periodic coupon payments and the time remaining until maturity. Bonds Corner Powered By The case for fixed-income investments: What Gen-Z investors should know Fixed-income investments offer Gen-Z investors stability and predictable returns, complementing a diversified portfolio. Experts advise understanding risk, utilizing mutual funds, and timing investments based on interest rate cycles. With increased accessibility through platforms like Bond Central, young investors can leverage fixed income for financial growth, balancing risk with disciplined investing through SIPs to achieve long-term security. Vedanta Resources dollar bonds see minor uptick JPMorgan considers cutting China, India share in EM Bond Index Sebi's bond central to deepen corporate bond market, improve price discovery: Vineet Agrawal ETMarkets Smart Talk: Fixed income still has a place in FY26 - 15–20% allocation ideal for most, 70% for seniors, says Aamar Deo Singh Browse all Bonds News with 2) No guaranteed returns: It is important to note that YTM is not a guaranteed return. It can fluctuate based on factors such as changes in market interest rates, liquidity conditions, time to maturity, and the creditworthiness of the issuer. Live Events 3) If the bond is sold before maturity, the actual return may differ significantly from the indicated YTM. 4) Generally, when a bond's price is below its face value, its YTM is higher than its coupon rate, and vice versa. 5) The coupon rate of a bond refers to the fixed annual interest paid by the issuer, calculated as a percentage of the bond's face value. This provides regular income to investors, usually on a semi-annual or annual basis. 6) Risks: The payments by issuers are not risk-free. They are dependent on the financial health and credit reliability of the issuer. Any delay or default in payments can adversely affect investor returns. 7) Relationship between bond prices and yields: Bond prices and yields move in opposite directions. When interest rates in the market rise, bond prices fall, leading to higher yields, and when interest rates fall, bond prices increase, lowering the yield. This inverse relationship is fundamental to assessing interest rate risk and understanding potential price movements in the secondary market. 8) Impact of brokerage: Brokerage reversal or zero brokerage can have a direct impact on the YTM by lowering the overall cost of investment, thereby slightly enhancing the effective return. The final return should always be assessed after considering all associated costs, fees, and applicable taxes. 9) Before investing through any online bond platform, investors must take into account several important factors such as checking the bond's credit rating, the issuer's track record in timely repayments, the liquidity of the instrument, settlement timelines, and the tax implications of the investment. 10) It is crucial to verify that the platform is a SEBI-registered Online Bond Platform Provider (OBPP). Investors should carefully read platform disclaimers, understand the terms and conditions, and ensure that transactions are carried out through properly regulated and secure systems.
Time of India
10-07-2025
- Business
- Time of India
JPMorgan considers cutting China, India share in EM Bond Index
JPMorgan Chase & Co. is considering cutting the weight of the largest bond issuers in its flagship emerging-market index — including China and India — as it seeks to reflect a broader range of developing-nation debt. The Wall Street bank has been soliciting feedback from clients on amendments to its GBI-EM Global Diversified index, the benchmark for local-currency developing-nation debt that's tracked by more than $200 billion of funds, documents seen by Bloomberg show. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Cheras: SUV Sale, Click Here to See Prices Luxury SUV Deals | Search Ads Search Now Undo One of the proposals envisages lowering a cap on individual countries from 10% to 8.5%, a move that could increase the average yield of the benchmark as nations with higher borrowing costs gain a bigger presence, according to the documents. While a loftier yield implies greater risks, it also means higher potential returns. Bonds Corner Powered By JPMorgan considers cutting China, India share in EM Bond Index JPMorgan is considering lowering the country cap in its GBI-EM index from 10% to 8.5%, potentially reducing China and India's weight while boosting smaller emerging markets. The proposal aims to diversify exposure and enhance index yield. Sebi's bond central to deepen corporate bond market, improve price discovery: Vineet Agrawal ETMarkets Smart Talk: Fixed income still has a place in FY26 - 15–20% allocation ideal for most, 70% for seniors, says Aamar Deo Singh India's Rs 50 lakh crore bond market grows, but retail investors still sit on the sidelines: Experts Adani Enterprises' Rs 500-crore NCD issue oversubscribed 3x Browse all Bonds News with The amendments are preliminary proposals, the documents show, and are not guaranteed to be adopted. In a consultation last year, JPMorgan initially floated a methodology change which would have resulted in China's index share falling to 6%, only to later withdraw the proposal. If the latest amendments are implemented, however, the weighting reductions would affect the largest bond sellers in emerging markets, including Indonesia, Mexico and Malaysia, as well as China and India, according to the documents. Brazil, South Africa, Poland and Colombia would be among the biggest beneficiaries, they show. Live Events Frontier Gauge JPMorgan is also previewing a new frontier local markets index, with $344 billion of debt across 521 bonds eligible, according to the documents. The new frontier gauge would cover 21 markets across 20 currencies. A spokesperson for JPMorgan declined to comment when contacted by Bloomberg. JPMorgan's index is the main benchmark for developing-nation debt funds and changes to its composition can affect global investment flows . Chinese bonds were phased into JPMorgan's indexes in 2020 while Indian debt was added last year. Bloomberg LP, the parent company of Bloomberg News, also offers index products for various asset classes through Bloomberg Index Services Ltd.
Time of India
10-07-2025
- Business
- Time of India
Sebi's bond central to deepen corporate bond market, improve price discovery: Vineet Agrawal
India's corporate bond market is set for a major revamp with the launch of Bond Central , a Sebi- and OBPP-backed platform aimed at creating a centralized, transparent database for bond issuances. The initiative is designed to simplify access to pricing, risk metrics, and disclosures for both retail and institutional investors. By reducing information gaps and lowering the minimum investment threshold to Rs 10,000, Bond Central is expected to drive greater retail participation, improve price discovery, and align India's bond infrastructure with global standards such as FINRA TRACE. With the launch of Bond Central, a Sebi-OBPP initiative to aid investors in the fixed-income market, Vineet Agrawal , Co-Founder of Jiraaf, shared his insights with ETMarkets: Bonds Corner Powered By Sebi's bond central to deepen corporate bond market, improve price discovery: Vineet Agrawal SEBI and OBPP have launched Bond Central, a centralized bond database aimed at boosting transparency and retail participation in India's corporate bond market. The platform offers easy access to pricing, risk metrics, and disclosures, while lowering the minimum investment to Rs 10,000. Experts say it could align India's market infrastructure with global standards and deepen fixed-income penetration. ETMarkets Smart Talk: Fixed income still has a place in FY26 - 15–20% allocation ideal for most, 70% for seniors, says Aamar Deo Singh India's Rs 50 lakh crore bond market grows, but retail investors still sit on the sidelines: Experts Adani Enterprises' Rs 500-crore NCD issue oversubscribed 3x Adani Enterprises' public debt issue oversubscribed on launch day, bankers say Browse all Bonds News with What are the primary objectives behind Sebi's initiative with OBPP to launch Bond Central? How does it benefit the fixed-income market in India? Sebi's stakeholders launched Bond Central to offer a single, centralized database of corporate bond issuances—including listing terms, pricing, risk metrics, and documents—accessible to both retail and institutional investors. By reducing information asymmetry, the initiative aims to foster greater transparency, build market confidence, and drive increased retail participation, which has historically been low. Could you explain how Bond Central will streamline bond market activities and help investors access bonds more efficiently? Bond Central aggregates listings from exchanges and issuers, enabling users to discover, compare, and evaluate bonds in one convenient location. It includes price comparisons with government securities (G-Secs) and fixed-income indices, supported by disclosures and risk insights. This simplifies decision-making and reduces reliance on multiple platforms. Live Events How will this initiative enhance liquidity and transparency in the Indian bond market? By publishing standardized data—including real-time pricing, yield, and credit risk—Bond Central helps reduce opacity in the secondary market. Better visibility supports improved price discovery and attracts more participants, thereby enhancing market liquidity over time. What impact do you foresee this Bond Central initiative having on retail investors and their participation in fixed-income products? Lowering the minimum investment threshold from Rs 1,00,000 to Rs 10,000 via OBPP platforms, combined with access to uniform bond information, democratizes market entry for retail investors. This will likely boost retail volumes, deepen market access, and narrow the participation gap between institutional and individual investors. Can you discuss the potential risks and challenges involved in this initiative and how Sebi and OBPP plan to address them? Key challenges include ensuring data accuracy, timely updates, and investor awareness of bond risk profiles. Sebi and OBPP aim to mitigate these through standardized disclosures, a strong governance framework under a non-profit model, and targeted investor education campaigns via the platform. In what ways can this move contribute to the development of a more vibrant corporate bond market in India? Improved transparency, easier access, and broader investor participation will encourage corporate issuers. As demand from retail investors rises, issuers may increasingly tap into this pool, creating a positive feedback loop. Streamlined issuance and distribution mechanisms will further support market vibrancy. How does this Bond Central initiative compare to similar initiatives in global markets, and what lessons can India learn from them? Bond Central aligns with global systems like the U.S. FINRA TRACE, which consolidates post-trade bond data to promote transparency. India can adopt best practices around real-time trade reporting, regulatory oversight, and compliance standards from such mature platforms. Do you think the introduction of a centralized bond platform will attract more foreign institutional investors (FIIs) to India's bond market? Why or why not? Yes. FIIs value rich, standardized, and reliable data. A centralized platform reduces market opacity and settlement friction, enhancing India's appeal. That said, FIIs will also consider other factors such as currency risk, regulatory clarity, and ease of capital movement. What role do digitalization and technological advancements play in making Bond Central a success, and what kind of infrastructure is required to support it? The success of Bond Central depends on robust digital infrastructure, real-time data feeds from exchanges and depositories, and APIs for seamless OBPP integration. Looking ahead, advanced analytics, AI-driven tools, and investor education features will be key to maximizing its utility. What advice would you give to investors looking to capitalize on this new development in India's bond market, especially in the context of changing interest rates and inflation? Utilize transparency: Compare corporate bonds with G-Secs to assess value and risk. Diversify: Spread investments across issuers and tenors to manage credit and interest rate risks. Stay informed: Monitor repo rate changes (currently 5.5%) and inflation trends. Match duration: Align bond maturity with your investment horizon and liquidity needs. Use tools: Leverage Bond Central's analytics and disclosures for informed decision-making.
Time of India
10-07-2025
- Business
- Time of India
India's Rs 50 lakh crore bond market grows, but retail investors still sit on the sidelines: Experts
India's corporate bond market has witnessed substantial growth in recent years, both in size and regulatory attention. Yet, it continues to trail global peers in terms of liquidity, participation, and ease of access—especially for retail investors. While policymakers and market infrastructure players have taken notable steps to strengthen the bond ecosystem, several structural hurdles remain. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Yasin: Unsold Furniture Liquidation 2024 (Prices May Surprise You) Unsold Furniture | Search Ads Learn More Undo To understand the true depth of the Indian corporate bond market—and why it hasn't yet become a mainstream asset class like equities or mutual funds—ETMarkets spoke to a few market experts who offered differing perspectives on its current state and what needs to change. Bonds Corner Powered By India's Rs 50 lakh crore bond market grows, but retail investors still sit on the sidelines: Experts India's corporate bond market shows significant growth. It still lags behind global markets in liquidity and retail access. Experts discuss structural issues like fragmented trading venues. They also highlight the need for better transparency. Low retail participation is due to limited awareness and complex processes. Improving infrastructure can unlock the market's potential. Policymakers are working to address these gaps. ETMarkets Smart Talk: Fixed income still has a place in FY26 - 15–20% allocation ideal for most, 70% for seniors, says Aamar Deo Singh Adani Enterprises' Rs 500-crore NCD issue oversubscribed 3x Adani Enterprises' public debt issue oversubscribed on launch day, bankers say IndianOil-Adani Gas plans $161 million exchangeable-bond sale Browse all Bonds News with Full Coverage on Bonds – Click Here Live Events How Big is India's Corporate Bond Market? And is it Really Underdeveloped? India's corporate bond market has grown to a substantial size, but whether it is adequately developed is a matter of perspective. Jessica Shah , Quantitative Research Analyst at 1 Finance, notes that as of March 2025, 'India's corporate bond market stood at Rs 53.6 trillion (US$642 billion). While it has grown meaningfully in recent years, it remains underdeveloped relative to global benchmarks, accounting for just 16–18% of India's GDP, compared to over 40% in many advanced economies (e.g., China: 36%, South Korea: 80%).' Echoing this view, Vishal Goenka , Co-founder of emphasizes the structural gaps holding back market maturity. 'The corporate bond market in India stood at INR 51.58 lakh crores or US$602 billion as of 31-Dec-2024 (Source: SEBI). It comprises 22.4% of the overall public bond market… [but] is still underdeveloped when compared to developed markets or the overall size of the Indian economy,' he states. Goenka points to fragmented trading venues as a major concern: 'On the stock exchanges, bonds can be traded on three different segments—the capital markets, over-the-counter (OTC), and request-for-quote (RFQ). Unlike equities and government bonds, which have homogenous venues, liquidity in corporate bonds gets divided.' However, not everyone believes the market is underdeveloped. Puneet Pal, Head – Fixed Income at PGIM India Asset Management, offers a more optimistic assessment. 'The Indian corporate bond market is pretty big, with over ₹50 lakh crore of outstanding bonds. Not only in terms of the amount of outstanding bonds but also in terms of different types of instruments/structures, the corporate bond market in India is well developed.' Still, Pal concedes that trading activity is limited and liquidity is a concern: 'The key challenge is in creating more liquidity… especially in lower-rated bonds below AA, where not many participants do active trading.' Why Liquidity Remains a Stumbling Block Despite its size, India's corporate bond market continues to suffer from shallow liquidity, especially in the secondary market. Pal highlights the disparity in trading volumes between corporate and government bonds: 'The daily trading volumes in the corporate bond market range between ₹8,000–10,000 crore, which pales in comparison to the ₹50,000–70,000 crore traded daily in the government securities market. Also, the corporate bond market remains an OTC market compared to the screen-based market in G-secs, which impacts price discovery, especially in lower-rated bonds.' Shah echoes these concerns, stating that the market is 'illiquid and opaque, dominated by top-rated issuers and institutional investors. High costs, limited retail access, and regulatory friction persist.' Goenka, too, believes a big part of the problem lies in the way bonds are traded: 'Even the nomenclature of pricing and information disclosure is asymmetrical across venues. The key to building a financial asset class is pooling of liquidity which grows its depth. Combining all venues into one single platform and interface will bring uniformity and help in the development of the bond market.' Retail Participation: Still a Distant Dream? Despite technological advancements and regulatory nudges, retail participation in the corporate bond market remains abysmally low—under 4% by some estimates. So what's keeping individual investors on the sidelines? Shah of 1 Finance attributes it to a mix of historical and structural issues: 'Low awareness, limited access, and lack of liquidity. While corporate bonds are generally seen as safer assets, many investors stay away due to complex risk-return dynamics and the opaque way in which defaults or delays are handled.' She adds that many bonds are issued via private placements, making them largely inaccessible to individual investors. However, she does note progress: 'In the past three years, regulators and fintech platforms have made notable progress in simplifying access and improving transparency.' Goenka, who runs an online bond platform, believes that although platforms like his have made investing easier, key bottlenecks remain. 'Participation has remained low due to lack of education and awareness, absence of a regulated distribution framework, and the cumbersome process of selling bonds,' he says. He explains further: 'Distributors play a vital role… but bond distribution continues to be unregulated with asymmetrical practices across offline and online debt brokers. A uniform code will help enhance retail education by experts.' He also points out the inefficiencies in exiting investments: 'The process of selling bonds for retail involves paperwork of filling delivery instruction slips (DIS) and a lengthy, inefficient process involving days. This further alienates participation and financial digital infrastructure needs to be built to make it easy to sell bonds for investors at a click.' From a fund manager's standpoint, Puneet Pal identifies lack of transparency and tax inefficiencies as key deterrents: 'The corporate bond market is perceived as complex… and taxation is also not favourable compared to equity investments. Thus, retail investors continue to prefer debt mutual funds and/or equities over direct participation.' On the Brink of Transformation While views differ on how developed the corporate bond market really is, there is consensus that improving secondary market liquidity, enhancing retail investor confidence, and streamlining infrastructure are critical. India's corporate bond market stands at an important crossroads. It has scale, growing institutional interest, and emerging technology platforms, yet remains underutilized and misunderstood by retail investors. As policymakers and market participants work together to address gaps in liquidity, transparency, and infrastructure, the market has the potential to become a more inclusive and efficient pillar of India's financial system. The road to reform is already underway—but bridging the gap between potential and participation will be key to truly unlocking the power of corporate bonds in India's capital markets. ( Disclaimer : Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)
Economic Times
10-07-2025
- Business
- Economic Times
ETMarkets Smart Talk: Fixed income still has a place in FY26 - 15–20% allocation ideal for most, 70% for seniors, says Aamar Deo Singh
In a market environment where equities often steal the spotlight, fixed income continues to quietly play its crucial role in portfolio construction—especially for risk-averse investors and retirees. In this edition of ETMarkets Smart Talk, we speak with Aamar Deo Singh, Sr. VP – Research at Angel One Ltd, who shares why fixed income still deserves a place in every investor's portfolio. Singh suggests a 15–20% allocation for the average investor to hedge against volatility and as much as 70% for senior citizens, underlining the importance of stability and capital preservation in uncertain times. From sectoral outlooks to asset allocation strategies for FY26, Singh breaks down what smart investing looks like in the months ahead. Edited Excerpts – ADVERTISEMENT Q) Thanks for taking the time out. Nifty closed with marginal gains in June, but for the first six months of 2025 – it is up over 7%. How do you see markets for the rest of FY26? Any big events to watch out for?A) Overall, markets have witnessed a sharp pullback from the lows of April, to rally by almost 18% from the low, to trade as high as 25,669 in June, clearly indicating the inherent strength of the market. Given the geo-political tensions between Iran & Isreal, spike in Crude Oil prices, Trump Tariffs threats, markets have displayed an unusual level of resilience, which bodes well for the rest of FY26. Given that domestic macros are positive, with CPI well below RBI's target rate of 4%, a declining trend in the interest rates, expected pick up in credit offtake in coming quarters, are expected to infuse bullish momentum in the we see any major global meltdown, Nifty does hold the potential to hit record highs in the coming quarters. ADVERTISEMENT Q) How are you managing the volatility in your portfolio? Any key learnings which you would like to share from 1H2025?A) One needs to bear this in mind that there is getting away from volatility and one will need to learn to live with volatility, sometimes less, sometimes going forward, fresh triggers, both negatives and positives, both domestic and global, will continue to drive the markets. ADVERTISEMENT So, it becomes a prudent approach to have a mix of stocks in one's portfolio, across multicaps, with a significant weightage to largecaps, in case one's risk appetite remains on the lower one also needs to ensure that one does not stay concentrated in any one particular sector, no matter, how much promising it might appear to be. ADVERTISEMENT Q) One of the reports suggested that India Inc.'s profits have grown nearly 3x faster than GDP since FY20. What structural factors are driving this divergence?A) India's GDP growth continues to remain amongst the fastest in the world, and it is expected that over the next couple of decades, it will continue to maintain its momentum with 6% plus annual growth rate. ADVERTISEMENT The changing demographics, government's impetus on scaling up the manufacturing base, assisting businesses in building infrastructure, focus on leveraging latest technologies, greater emphasis on growing exports at a faster pace, all these factors have aided the country's growth and led to multifold growth in profitability of India Inc. Q) With the China+1 theme gaining traction, which Indian sectors are best placed to attract global capital and scale? A) Post Covid and post Trump's tariff threats, India continues to remain in a sweet spot as the world, particularly the US & Europe, are looking at building alternate sources for their requirements, and with India's technological capabilities, cost competitive manpower advantage, and the necessary infrastructure along with incentives, have helped India scale up its production and manufacturing capabilities, over the past few sectors such as defence, capital goods, consumer durables and infrastructure, are few sectors which are likely to attract global capital and scale in coming years. Q) How is fixed income as an asset class looking for long term investment. How much money should one allocate as a hedge to combat volatility? A) Fixed income as an asset class generates a significant amount of interest in investors, as this is an asset class, which generally helps in protection of capital, during volatile the investors who invest in this asset class, are more of the risk-averse type, looking at steady income flows rather than focussed too much on capital one should definitely look at investing 15%-20% of one's capital in Fixed Income assets, and higher proportion, in excess of 70%, is recommended for senior citizens. Q) Which sectors are likely to remain in the spotlight in 2H2025? A) Sectors that are likely to remain in focus in 2H2025, include the likes of financials, defence, capital goods, pharma, energy, to make a few. Auto ancillaries are also expected to do well, in the coming quarters, once we see an upick in credit offtake, post the 100 basis CRR cut by the RBI in its last MPC meeting, the effects of which are expected to be felt from September onwards, wherein expectation of over 2.5 trillion rupees are expected to additionally flow in the financial system. Q) Can we say that we are in a "stock picker's market" ahead. If yes, what are the key traits investors should look for in FY26 picks? A) It is true that money isn't going to come easy in the current market scenario, and it is a stock picker's market because given the sharp run-up across the board, across sectors, valuations in many cases don't come it is always prudent to remember the fact that the company might be a good investment from a long-term perspective, the million-dollar question is at what it makes sense to do a stock SIP in companies from a long-term perspective. Else one can also look at ETFs as an option as well. Q) Gold has also seen a tremendous run in 2025 – how do you see the yellow metal shining in 2H2025? Time to book profits or add on dips? A) Gold has outperformed all asset classes this year, so far in 2025, with domestic gold prices up by almost 25% YTD, clearly indicating the love for the yellow metal, amongst the investor class. Further, with the significant weakness seen in the US Dollar, and with the Trump Tariffs jitters initially, gold, also considered a safe haven asset, witnessed sharp untick in buying from central banks who are even more keen in diversifying their foreign exchange reserves, apart from ETFs which too witnessed significant inflows, with global holdings rising by 397 tonnes in first half of 2025, the largest increase in the past five years. Gold should be part of everyone's portfolio and holding it from a long-term perspective definitely merits attention. Q) How should one play the small & midcap theme? Has the profitability improved compared to largecaps – what does the data suggest? A) As far as the small & midcap are concerned, investors need to adopt a cautious approach because history has shown us that the fall is faster than the rise, and the fall is extremely steep, many times in excess of 50% erosion in caps on the other hand, are more of the 'slow & steady' category, so ideally having a mix of all, would be a more appropriate approach, depending on one's risk appetite. Q) Any sector which is running out of steam and investors should carefully pare their positions? A) Defence stocks have witnessed a spectacular rally, and post the India-Pakistan conflict, this sector has once again taken off, with prices of some of the stocks hitting record highs and expensive it would be wise to not invest all at one go in this sector, rather adopting an SIP mode over the long-term, would deliver better results. (Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)
