Rate Cuts Fail to Boost Indian Corporate Bonds in 2025; Issuance Flat YoY

• Indian corporate bond issuances remained flat in 2025 at Rs 10.84 lakh crore, despite RBI's 125 bps rate cuts.
• Rising government bond yields and shifting investor preferences offset the benefits of lower policy rates.
• Issuance momentum slowed sharply in the second half of 2025 due to increased borrowing costs.
• Top issuers like NABARD, PFC, REC Ltd, Bajaj Finance Ltd, and IRFC dominated, but even PFC withdrew issuances due to high yield demands.
• 2026 outlook depends on effective RBI rate transmission, system liquidity, global factors, and domestic fiscal policies.

Why It Matters: Despite RBI rate cuts, Indian corporate bond market saw flat participation in 2025 due to higher yields.