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12,013.10-5.3
Stock Analysis, IPO, Mutual Funds, Bonds & More

Realities not in corp bonds valuations

HDFC 2020 papers were valued at 9.37 per cent, while Reliance Capital’s 2026 securities were valued at 8.55 per cent.

, ET Bureau|
Oct 02, 2019, 08.47 AM IST
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FIMMDA, or Fixed Income Money Market and Derivatives Association of India, which has begun putting out its daily valuations of corporate bonds, is facing teething problems. Market participants have come across instances of sharp disparities in bond valuations put out by the market body that do not reflect the market realities. They were taken by surprise when the yields put out by FIMMDA on the top-rated HDFC papers were shown to be higher than that on Reliance Capital, which has been under severe pressure of late. HDFC 2020 papers were valued at 9.37 per cent, while Reliance Capital’s 2026 securities were valued at 8.55 per cent.

Traders said the valuations of FIMMDA, which are used by primary dealers and banks, would not have any impact on corporate bond portfolios as market players are yet to adopt it. But, they have asked it to correct the anomalies soon.
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