Aditya Birla Finance is now 1st firm to list commercial papers on exchanges

Aditya Birla Finance Ltd (ABFL), the NBFC arm of Aditya Birla Capital, on Thursday became the first company to list its commercial papers on the stock exchanges.

The move comes after the exchanges -- the BSE and the NSE -- came out with a framework for listing of commercial papers (CPs), in a bid to broaden investors' participation in such securities.

Listing of CPs is expected to lead to efficient transmission of information regarding corporate borrowings and liquidity positions to market participants, the NSE said in a statement.

It will also contribute effectively towards development of the commercial paper market and is expected to have a positive effect on the debt capital market, it added.

In separate statements, the exchanges said Aditya Birla Finance is the first company to list its commercial paper with value date of November 28 and maturity date on February 7, 2020.

ABFL is a well-diversified non-banking finance company (NBFC) with a long-term credit rating of AAA (stable) from both ICRA as well as India Ratings.

CP is an unsecured money market instrument issued in the form of promissory notes that enables highly rated corporate borrowers to diversify their sources of short-term borrowings and provides an additional instrument to investors.

Commercial papers can be issued for maturities between a minimum of 7 days and a maximum of up to one year from the date of issue. CP are usually issued at a discount from face value and reflects prevailing market interest rates.