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Commercial Paper 


 
A Commercial Paper (CP) is an unsecured money market instrument issued in the form of a promissory note. With a view to enable highly rated corporate borrowers to diversify their sources of short-term borrowing and also provide an additional instrument to investors, RBI introduced Commercial Papers as a money market instrument in the Indian financial market in 1990.
 
Corporates and primary dealers (PDs), and all-India financial institutions (FIs) that have been permitted to raise short-term resources by Reserve Bank of India are eligible to issue CP. A corporate would be eligible to issue CP provided subject to certain conditions. All eligible issuers are required to obtain a credit rating for issuance of Commercial Paper from a credit rating agency as may be specified by the Reserve Bank of India from time to time.
 
CPs are issued at a discount to face value, as may be determined mutually by the issuer & investor. They can be issued for maturities between a minimum of 7 days and a maximum up to one year from the date of issue and can be issued in denominations of Rs.5 lakh or multiples thereof. Issuers may buyback the CP, issued by them to the investors, before maturity but not before 7 days from the date of issue.
 
CP may be issued to and held by individuals, banking companies, other corporate bodies registered or incorporated in India and unincorporated bodies and Non-Resident Indians (NRIs). Generally, mutual funds, banks, insurance companies, etc are the dominant investors in the CP market.
 
Secondary market trading takes place through the interbank broking market between institutional participants. OTC trades in CP shall be settled through NSCCL, ICCL and MSEI CCL. The settlement cycle for OTC trades in CP shall either be T+0 or T+1.
 
Clients interested buying/selling CPs may contact our Sales Personnel on 022-66202224/25/28. We endeavor to provide the best possible returns to our clients, keeping in line with their overall investment objectives.
 
 
 

Latest News

As per our estimates
As per our estimates, CPI for the month of October stood at 3.58% as opposed to 3.28% in September mainly on account of a significant rise in Food and Fuel prices. Core CPI in the current reading saw some moderation, standing at 4.55% compared to 4.61% last month.
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Standing 100 bps
Standing 100 bps higher, WPI came in at 3.59% in October compared to 2.60% in the previous month.
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Industrial production
Industrial production as measured by IIP grew at 3.8% in Oct-17, moderating from 4.5% growth observed in Sep-17, largely led by a surprising momentum in the Mining sector.
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