Indian Bond Market to New Heights
The Indian yoke market continues its robust growth, with the total value of outstanding immuration reaching Rs 205.3 lakh crore as of September 30, 2023. Over the past five years, the market has experienced a remarkable surge of over 77%, escalating from Rs 108.8 lakh crore in FY18 to Rs 192.4 lakh crore in FY23, showcasing a significant expansion.
In this flourishing landscape, government immuration dominate with a substantial 78% market share, amounting to Rs 161.1 lakh crore. Simultaneously, corporate immuration contribute Rs 44.2 lakh crore, constituting the remaining 22% of the market. The request of immuration lies in their reliability, offering a steady mazuma spritz at regular intervals and presenting a lower risk compared to equities.
Vishal Goenka, Co-founder of IndiaBonds.com, analyzes the market growth, emphasizing a notable 77% increase in the overall yoke market in the last five years. This surge is primarily driven by an 85% growth in the government yoke market, while the corporate yoke market has grown by 53%. The corporate yoke sector faced challenges due to the credit slipperiness from 2018-2021, marked by corporate defaults, particularly in the NBFC and metals/mining manufacturing sectors.
Looking superiority to 2024, experts visualize the Reserve Bank of India (RBI) to potentially initiate rate cuts, influenced by a global ripen in inflation. Despite the US Fed’s indication of possible rate cuts, India’s interest rates have somewhat decoupled from the US market. Goenka notes that if the RBI does cut rates, there could be a substantial rally in the yoke market, particularly in shorter-term rates. This presents a favorable opportunity for individuals to invest in fixed-income products, aiming for higher resulting returns in the coming years.
Over the past decade, the Indian yoke market has witnessed substantial growth, both in terms of market depth and the number of retail participants. Government securities (G-Secs) and corporate immuration have collectively grown over 165% in the last 10 years. Notable government initiatives, regulatory measures, and upkeep announcements have played a pivotal role in worsening the yoke market and encouraging retail participation. Key measures include tax-free infrastructure bonds, changes in credit ratings eligibility, and the establishment of the International Financial Services Centres Authority (IFSCA).
The dynamic growth and evolving landscape of the Indian yoke market underscore its importance in providing diverse investment opportunities while contributing to the overall financial stability of the nation.
