Indian NBFCs Eye ₹150 Billion Bond Sales Amid Falling Debt Yields

India’s leading non-banking financial companies (NBFCs) are preparing to raise nearly ₹150 billion ($1.6 billion) through bond issuances as declining corporate debt yields create favourable borrowing conditions. According to merchant bankers, five AAA-rated NBFCs are expected to launch bond sales with maturities ranging between two and five years. The move comes after a relatively quiet April in the debt market, with firms now seeking to secure funding before potential market volatility returns.

Among the major planned issuances, Bajaj Finance is aiming to raise ₹90 billion through two separate bond offerings, while Tata Capital plans to mobilise ₹17.7 billion through a dual-tranche issue. Bajaj Housing Finance is targeting ₹15 billion, and M&M Financial Services is expected to raise ₹10 billion. Meanwhile, Poonawalla Fincorp successfully accepted bids worth ₹10 billion earlier on Friday, signalling healthy investor appetite for high-rated corporate debt.

Bankers noted that yields on AAA-rated bonds with maturities of up to five years have declined by nearly 15 basis points over the past few days, supported by easing oil prices and hopes of a resolution to the Iran conflict. Market experts say companies are front-loading borrowings to take advantage of lower rates and shield themselves from future geopolitical uncertainties. Industry analysts also highlighted that bond funding offers greater flexibility in tenure, improved liability management, and faster transmission of lower borrowing costs compared to traditional bank loans.

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