Latest news with #PuneetPal
Time of India
30-07-2025
- Business
- Time of India
The exit strategy renaissance: How liquidity solutions are building retail bond confidence
Greed and fear—psychologists often cite these as the two most fundamental human emotions. They trace their roots to our primal survival instincts, developed when early humans still lived in caves. Yet in today's world, where life is increasingly digital rather than physical, these same instincts continue to guide behaviour—especially in how we invest. Modern consumers value flexibility. We prefer rides over car ownership, subscriptions over lump-sum purchases, and the ability to exit almost anything—especially investments—at the click of a button. One-day exits are no longer a luxury; they are an expectation. And who can blame us? In just the past two decades, this generation has experienced one shock after another: the 2008 Global Financial Crisis, the 2011 Eurozone sovereign debt crisis, the 2015 Chinese stock market crash, India's 2018 NBFC liquidity crunch, the global upheaval caused by the COVID-19 pandemic, and ongoing geopolitical tensions, including the Russia-Ukraine and Israel-Hamas conflicts. Bonds Corner Powered By The exit strategy renaissance: How liquidity solutions are building retail bond confidence India's bond market is undergoing a transformation, becoming more accessible and liquid for retail investors. Key reforms—lower ticket sizes, digital platforms, and retail-only liquidity windows—are boosting participation and trust. Monthly investments have surged, signalling a shift towards bonds as a mainstream, flexible investment option. India bonds range-bound ahead of US Fed policy, caution persists GMR Energy in talks with investors to issue 5-year bonds US debt crisis fuels de-dollarisation talk; may boost emerging markets: Puneet Pal India bonds inch up before state debt supply, US rate decision Browse all Bonds News with It's no surprise, then, that the world's largest investment asset classes—public equities, currencies, commodities, deposits, and even crypto—are deeply liquid by design. Liquidity wasn't an afterthought; it was the foundation that enabled these markets to scale. Live Events To put that in perspective: the global market capitalization of public equities is estimated to be over $125 trillion, while private equity remains under $6 trillion. Liquidity doesn't just attract institutional investors; it is a prerequisite for retail participation. For individual investors, whose capital is often hard-earned and limited, the ability to exit is as important as the ability to enter. India's bond market: From private to public Until recently, India's bond market was largely inaccessible to retail investors . Illiquidity, high ticket sizes, and a lack of transparency kept it in the domain of institutions and ultra-HNIs. But that began to change meaningfully in late 2023 and 2024, thanks to a series of progressive reforms by SEBI. These reforms are laying the groundwork for a more liquid, retail-friendly bond ecosystem. 3 pivotal changes are driving this transformation: 1. Democratized Access SEBI reduced the minimum investment size in listed bonds from Rs 10 lakh to Rs 10,000—a 99% drop. Some issues are now even available in Rs 100 or Rs 1,000 denominations. Broader participation is the first and most important building block of liquidity. 2. Digital Distribution via OBPPs The introduction of the Online Bond Platform Provider ( OBPP ) framework has enabled licensed fintech platforms to offer bonds with transparency, ease, and low cost. Over 34 entities have secured this license, bringing bonds to the fingertips of everyday investors. 3. Retail-Only Liquidity Windows A regulatory innovation allows issuers to create buyback windows specifically for retail investors. This is a significant safeguard—providing an exit option without extending the same to institutional holders. What it means for retail investors These developments haven't just made bond investing possible for retail investors—they've made it trustworthy. Liquidity was the missing link, and it's being addressed head-on. Platforms like Grip Invest and Wint Wealth have led the way in creating features that enable users to exit bond positions before maturity. This newfound ability to sell is critical—it aligns the product with modern investor expectations. As a result, monthly investments by retail investors via OBPPs have surged to approximately Rs 1,000 crore—a 300% increase over the past year (Source: NSE, BSE). Equally telling: on some OBPPs, sell orders now account for 5% of all transactions. Even more encouraging, 24% of users who've exited a bond are returning to reinvest within three months. This indicates that providing an exit doesn't reduce demand—it enhances long-term participation. What's next? In finance, regulatory reform often sparks a virtuous cycle. Lower investment thresholds attract more investors. More investors create deeper markets and enable better price discovery. Better discovery attracts more issuers, and a wider range of bonds further fuels investor interest. We're at the cusp of such a transformation in India's bond markets. Liquidity—long considered the Achilles' heel of fixed-income products for retail—may well prove to be the catalyst for a new era. An era where bonds are no longer a private, opaque corner of the capital markets, but a mainstream investment option for the digitally savvy Indian investor. (The author of the article is Nikhil Aggarwal, Founder & Group CEO, Grip Invest) ( Disclaimer : Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
Economic Times
30-07-2025
- Business
- Economic Times
US debt crisis fuels de-dollarisation talk; may boost emerging markets: Puneet Pal
The growing fiscal challenges in the United States are starting to ripple across global markets, sparking renewed conversations around de-dollarisation. In an exclusive interaction with ETMarkets, Puneet Pal, Head of Fixed Income at PGIM India Mutual Fund, explains how the rising U.S. debt burden and persistent fiscal deficits are reshaping investor sentiment. While immediate outflows from U.S. bonds remain limited, Pal believes the long-term implications could be significant — potentially benefiting emerging market assets, including India. He also shares his outlook on yield curves, the shift in U.S. bond issuance strategy, and the broader impact on global fixed income markets. Edited Excerpts – ADVERTISEMENT Q) How would you describe the current size and depth of the corporate bond market in India?A) Indian corporate bond market is big, with over Rs. 53 lakh crore of outstanding corporate bonds. Not only in terms of the amount of outstanding bonds but also in terms of different types of instrument/structure, the corporate bond market in India is well developed. In terms of the depth, AAA rated securities dominate both the primary market and the secondary market liquidity. The key challenge is to increase the secondary market liquidity especially in lower rated securities. Institutional investors are, by far, the largest holders and participants in the corporate bond market. Retail participation is limited. Majority of the institutional investors in the corporate bond market are long only investors with a buy and hold is especially true in respect of lower rated bonds below AA with not many participants doing active trading, resulting in lower trading volumes compared to the government securities market. ADVERTISEMENT Thus, we can say that in spite of impressive increase in the total outstanding amount, depth of the corporate bond market remains relatively shallow. The daily trading volumes in the corporate bond market range between Rs. 8,000-10,000 crores on an average which pales in comparison to the daily average trading volumes in government securities market of Rs. 50,000-70,000 crores. ADVERTISEMENT 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 we need to increase liquidity in the secondary market and along with it make the secondary market price discovery more efficient. Q) 2025 has seen record-breaking corporate bond issuances. What factors are driving this surge in new issuance? ADVERTISEMENT A) We have seen a decent increase in primary market activity this year. This is mostly driven by lower interest rates with issuers looking to lock in the current attractive yields. Majority of the issuance has been from NBFCs and PSUs. Q) The US is currently grappling with a growing debt crisis. How do you see this impacting global bond markets? A) The US economy is facing a huge debt challenge with elevated fiscal deficit. The rising debt burden and the Tariff issue has fuelled the narrative of de-dollarisation, leading to a search for diversification away from the US dollar/Bonds. ADVERTISEMENT Though, at present, this has not led to a meaningful flow away from US bond markets but can have potentially far-reaching consequences for US assets and can benefit emerging market assets. Given the fact that higher debt/fiscal deficit in US, will lead to US yields staying elevated, the yield curve can remain/become steeper including in the case of emerging markets. Q) Issuance of ultra-long-term US Treasury bonds has slowed down. What's driving this trend? A) The need to reduce the pressure on long end bond yields in US has led to more issuance at the shorter end and this trend may continue in the near term. (Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)
Time of India
30-07-2025
- Business
- Time of India
US debt crisis fuels de-dollarisation talk; may boost emerging markets: Puneet Pal
The growing fiscal challenges in the United States are starting to ripple across global markets, sparking renewed conversations around de-dollarisation . In an exclusive interaction with ETMarkets, Puneet Pal, Head of Fixed Income at PGIM India Mutual Fund , explains how the rising U.S. debt burden and persistent fiscal deficits are reshaping investor sentiment. While immediate outflows from U.S. bonds remain limited, Pal believes the long-term implications could be significant — potentially benefiting emerging market assets, including India. He also shares his outlook on yield curves, the shift in U.S. bond issuance strategy, and the broader impact on global fixed income markets . Edited Excerpts – Q) How would you describe the current size and depth of the corporate bond market in India? Explore courses from Top Institutes in Please select course: Select a Course Category others Management Data Science Others Project Management Finance Data Analytics MCA Digital Marketing healthcare Design Thinking Leadership Operations Management Healthcare Cybersecurity MBA CXO Technology Product Management Data Science Skills you'll gain: Duration: 16 Weeks Indian School of Business CERT - ISB Cybersecurity for Leaders Program India Starts on undefined Get Details A) Indian corporate bond market is big, with over Rs. 53 lakh crore of outstanding corporate bonds. Not only in terms of the amount of outstanding bonds but also in terms of different types of instrument/structure, the corporate bond market in India is well developed. In terms of the depth, AAA rated securities dominate both the primary market and the secondary market liquidity. The key challenge is to increase the secondary market liquidity especially in lower rated securities. Bonds Corner Powered By GMR Energy in talks with investors to issue 5-year bonds India's GMR Energy plans to raise 16 billion rupees ($184 million) via five-year bonds, two sources told Reuters on Tuesday, as the holding firm for two major power units taps the market for fresh funding. US debt crisis fuels de-dollarisation talk; may boost emerging markets: Puneet Pal India bonds inch up before state debt supply, US rate decision Retail investors are waking up to bonds—here's why it matters, says Vineet Agarwal Fixed income isn't just for retirees, it belongs in every portfolio: Jiraaf's Vineet Agarwal Browse all Bonds News with Institutional investors are, by far, the largest holders and participants in the corporate bond market. Retail participation is limited. Majority of the institutional investors in the corporate bond market are long only investors with a buy and hold strategy. Live Events This is especially true in respect of lower rated bonds below AA with not many participants doing active trading, resulting in lower trading volumes compared to the government securities market. Thus, we can say that in spite of impressive increase in the total outstanding amount, depth of the corporate bond market remains relatively shallow. The daily trading volumes in the corporate bond market range between Rs. 8,000-10,000 crores on an average which pales in comparison to the daily average trading volumes in government securities market of Rs. 50,000-70,000 crores. 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. Thus, we need to increase liquidity in the secondary market and along with it make the secondary market price discovery more efficient. Q) 2025 has seen record-breaking corporate bond issuances. What factors are driving this surge in new issuance? A) We have seen a decent increase in primary market activity this year. This is mostly driven by lower interest rates with issuers looking to lock in the current attractive yields. Majority of the issuance has been from NBFCs and PSUs. Q) The US is currently grappling with a growing debt crisis. How do you see this impacting global bond markets? A) The US economy is facing a huge debt challenge with elevated fiscal deficit. The rising debt burden and the Tariff issue has fuelled the narrative of de-dollarisation, leading to a search for diversification away from the US dollar/Bonds. Though, at present, this has not led to a meaningful flow away from US bond markets but can have potentially far-reaching consequences for US assets and can benefit emerging market assets. Given the fact that higher debt/fiscal deficit in US, will lead to US yields staying elevated, the yield curve can remain/become steeper including in the case of emerging markets . Q) Issuance of ultra-long-term US Treasury bonds has slowed down. What's driving this trend? A) The need to reduce the pressure on long end bond yields in US has led to more issuance at the shorter end and this trend may continue in the near term.
Economic Times
23-07-2025
- Business
- Economic Times
Corporate bond curve in 3–6-year segment offers investment opportunity amid rate cut hopes: PGIM India MF
Investment Strategy: Short-term and dynamic bond funds Live Events Indian debt market update International markets (You can now subscribe to our (You can now subscribe to our ETMarkets WhatsApp channel The 3–6-year segment of the corporate bond curve presents a favorable investment opportunity in the current interest rate environment, according to Puneet Pal, Head of Fixed Income at PGIM India Mutual the Reserve Bank of India maintaining an accommodative stance to support economic growth, the focus remains on ensuring effective transmission of policy rate cuts and keeping banking liquidity at comfortable India Mutual Fund expects average CPI inflation for FY26 to be approximately 50 basis points lower than the RBI's projection, increasing the likelihood of further rate cuts. 'Given these conditions, the 3–6-year corporate bond curve, particularly AAA-rated PSU bonds, looks attractive. The current spread of 60–70 basis points between 5-year PSU bonds and equivalent government securities is appealing, especially when banking system liquidity remains in surplus,' said addition to the 3–6-year corporate bond space, PGIM India MF sees a tactical opportunity at the longer end of the yield curve. 'Yields on 30-year bonds have remained unchanged over the past year, creating potential for value buying,' Pal are advised to continue allocating to short-term or corporate bond funds with portfolio maturities of up to six years, while remaining tactical with duration via dynamic bond funds PGIM India recommends an investment horizon of 12–18 months. Money market instruments with up to one-year maturities also offer attractive risk-reward profiles, the fund house ahead, PGIM India expects the 10-year benchmark bond yield to remain in the range of 6.10% to 6.50% over the next yields trended lower through July, driven by better-than-expected inflation data. The 10-year bond yield closed at 6.36% on July 18, down 2.5 basis points since the start of the month, while the long-duration segment outperformed as 30-year and 40-year bond yields fell by 10 basis June CPI inflation came in at 2.10%, below market expectations of 2.25%, driven largely by falling food prices. Core inflation (excluding food, beverages, and fuel) rose slightly to 4.4%. PGIM India expects FY26 CPI inflation to average around 3%, well below the RBI's 3.7% forecast, raising the probability of another 25 basis points policy rate cut by December inflation declined to -0.13%, marking the lowest level since October 2023. Meanwhile, India's goods trade deficit narrowed to USD 18.8 billion in June, supported by a sharp decline in oil and gold imports. The services trade surplus remained steady at USD 15.3 conditions have also been supportive. Cumulative rainfall stood 12% above the long-term average as of mid-July, leading to higher sowing across key Kharif crops like rice, pulses, coarse cereals, and bond yields continued to remain elevated as debt concerns dominated the narrative, along with the continued strength of the US US benchmark 10-year bond yield ended the week at 4.42%, 19 basis points higher than the month's starting level of 4.23%.Long-end Japanese bond yields also rose, with the 30-year bond yield touching a high of 3.15%. Chinese CPI turned positive after five months, rising 0.1% year-on-year.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
Time of India
23-07-2025
- Business
- Time of India
Corporate bond curve in 3–6-year segment offers investment opportunity amid rate cut hopes: PGIM India MF
The 3–6-year segment of the corporate bond curve presents a favorable investment opportunity in the current interest rate environment, according to Puneet Pal, Head of Fixed Income at PGIM India Mutual Fund. With the Reserve Bank of India maintaining an accommodative stance to support economic growth, the focus remains on ensuring effective transmission of policy rate cuts and keeping banking liquidity at comfortable levels. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like War Thunder - Register now for free and play against over 75 Million real Players War Thunder Play Now Undo PGIM India Mutual Fund expects average CPI inflation for FY26 to be approximately 50 basis points lower than the RBI's projection, increasing the likelihood of further rate cuts. 'Given these conditions, the 3–6-year corporate bond curve, particularly AAA-rated PSU bonds, looks attractive. The current spread of 60–70 basis points between 5-year PSU bonds and equivalent government securities is appealing, especially when banking system liquidity remains in surplus,' said Pal. In addition to the 3–6-year corporate bond space, PGIM India MF sees a tactical opportunity at the longer end of the yield curve. 'Yields on 30-year bonds have remained unchanged over the past year, creating potential for value buying,' Pal noted. Investment Strategy: Short-term and dynamic bond funds Investors are advised to continue allocating to short-term or corporate bond funds with portfolio maturities of up to six years, while remaining tactical with duration via dynamic bond funds . Live Events PGIM India recommends an investment horizon of 12–18 months. Money market instruments with up to one-year maturities also offer attractive risk-reward profiles, the fund house said. Looking ahead, PGIM India expects the 10-year benchmark bond yield to remain in the range of 6.10% to 6.50% over the next month. Indian debt market update Bond yields trended lower through July, driven by better-than-expected inflation data. The 10-year bond yield closed at 6.36% on July 18, down 2.5 basis points since the start of the month, while the long-duration segment outperformed as 30-year and 40-year bond yields fell by 10 basis points. India's June CPI inflation came in at 2.10%, below market expectations of 2.25%, driven largely by falling food prices. Core inflation (excluding food, beverages, and fuel) rose slightly to 4.4%. PGIM India expects FY26 CPI inflation to average around 3%, well below the RBI's 3.7% forecast, raising the probability of another 25 basis points policy rate cut by December 2025. WPI inflation declined to -0.13%, marking the lowest level since October 2023. Meanwhile, India's goods trade deficit narrowed to USD 18.8 billion in June, supported by a sharp decline in oil and gold imports. The services trade surplus remained steady at USD 15.3 billion. Monsoon conditions have also been supportive. Cumulative rainfall stood 12% above the long-term average as of mid-July, leading to higher sowing across key Kharif crops like rice, pulses, coarse cereals, and oilseeds. International markets Globally, bond yields continued to remain elevated as debt concerns dominated the narrative, along with the continued strength of the US economy. The US benchmark 10-year bond yield ended the week at 4.42%, 19 basis points higher than the month's starting level of 4.23%. Long-end Japanese bond yields also rose, with the 30-year bond yield touching a high of 3.15%. Chinese CPI turned positive after five months, rising 0.1% year-on-year.
