Mumbai - Indian corporate bond issuance this year looks set to surpass 2013 and 2014 as expensive bank loans force companies seeking funding to try their luck in capital markets. So far, they haven't been disappointed.
Indian firms have raised 335.9 billion rupees ($5.40bn) via short- and long-term corporate debt in a little over a month and a half this year, well on their way to matching the total of 2.3 trillion rupees raised in each of the previous two years, according to Thomson Reuters data.
Bank loans are relatively expensive even after the Reserve Bank of India reduced its key policy rate last month to 7.75% from 8%. Only three out of 45 domestic commercial banks have lowered rates, with most arguing they cannot cut costs for borrowers as they are facing tight cash conditions.