Corporate Bonds are kind of loans companies can take from investors by issuing bonds. The company that issues the bond agrees to pay interest to the investors. Through the bonds, it raises fund for expansion, new equipment etc. When the bond reaches its end date, the company repays the principal amount. This is regulated by Securities and Exchange Board of India (SEBI).

According to sources, India’s corporate bond market size stands at approximately Rs.58-59 lakh crore.  While corporate bonds offer various benefits, a vast section of the Indian business fraternity still chose traditional banking system to raise funds.

Bombay Stock Exchange (BSE), National Stock Exchange of India (NSE) and Indian Chamber of Commerce & Industry, Coimbatore (ICCIC) organized an Issuer Outreach Program for Corporate Bond Market in Coimbatore.  This is an initiative of SEBI held to create awareness about Corporate Bond and also to hear their queries about it.  The event was held at Chamber Towers.

Maninder Cheema, Executive Director, SEBI; Sundararaman Ramamurthy, MD & CEO of BSE and Saravanan, CGM-DDHS, SEBI attended the program and addressed the members of the Chamber and Coimbatore’s Business Community about Corporate Bond.
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Earlier during the press conference, the three guests shared that Corporate Bond is not a new way for companies to raise funds for their growth but it is utilized less due to various reasons. This outreach program aims to find out that reasons and address that.

Saravanan, Chief General Manager – Department of Debt and Hybrid Securities (DDHS) at SEBI shared that this is the first time that such a program is taking place anywhere in India outside Mumbai. Coimbatore is the first place they have chosen to meet the business organizations (who could become issuers of Corporate Bonds).

Maninder Cheema, Executive Director, SEBI shared that around 70-80 % of  Rs. 59 Lakh Crore is AAA or AA issuers (these companies carry the highest credit rating), and they are very good companies like PSUs and AAA corporates. “So what we are trying to do on the one side is allow the retail investors to participate in these kind of issuances which are reasonably secure and give them yield which is better than FDs and also participate in very good bonds,” she said.

Sundararaman Ramamurthy, MD & CEO of BSE said that this program is for both companies (issuers) and for investors. He said that while Coimbatore has 38 listed companies but not even one of them use Corporate Bonds to raise funds. Post the press conference, Annamalai and Natarajan, Vice Presidents and Pradeep, Hon.Secretary ICCIC welcomed the delegates to Coimbatore. Special addresses ensued and an interactive session was held.