Sebi guidelines on corporate bonds likely to keep yields elevated

For companies rated AA+, the spread has widened to as high as 180 basis points for dated bonds, which should be a matter of concern

Bond dealers anticipate a hardening of yields because of the Securities Exchange Board of India (Sebi) rules mandating a large corporate entity to borrow from the bond market.

Already spreads between the bonds issued by better-rated firms and the government yields are as high as 100 basis points. The spreads will continue to remain at these levels and may not come down to their previous normal of 50-60 basis points, said to Ramkamal Samanta, vice-president, investments, Star Union Dai-Ichi Life Insurance.

For companies rated AA+, the spread has widened to as high as 180 basis points for dated bonds, which should