Domestic rating agency ICRA said here today that corporate bond issuance, which has been lagging for sometime, may pick up steam during the second half, following the corporate affairs ministry's clarifications.
Issuances would go up following a notification that non-bank lenders do not need to maintain debenture reserves for private placement of debt, it said, adding non-banking finance companies (NBFCs) are one of the most active players in the debt market.
It said that NBFCs had stayed away from the market due to stipulations of the amended Companies Act which had placed some restrictions.
Besides this, issuance of paper by banks, which are expected to hit the street with long-term bond offerings, would also help the volumes, ICRA said.
"The magnitude of FII flows into debt and equity markets going ahead is likely to remain healthy, with a stable government in place and expectations of implementation of various reforms resulting in a pick-up in economic growth," it said.
