PNB Gilts Hits Upper Circuit on Inclusion of Indian Bonds in JPMorgan Index
Shares of PNB Gilts hit 20 percent upper circuit on September 22, 2023, to hit Rs 81 per share on BSE in intra-day trade on the back of heavy volumes, on news that India’s inclusion in JPMorgan’s bond index is seen driving billions of dollars of inflows.
The index provider will add Indian bonds to its widely-tracked emerging market index starting June 28, 2024, wherein India would have a maximum weightage of 10 percent. Around 23 Indian Government Bonds (IGBs) of a combined notional value of $330 billion are eligible. All of these fall under the category of ‘fully accessible’ for non-residents.
PNB Gilts is a primary dealer in government securities and other fixed-income instruments. It is a subsidiary of Punjab National Bank (PNB).
The company’s total income grew to Rs 926 crore in 2022-23 from Rs 757 crore in 2021-22. Its net loss narrowed to Rs 77 crore as against Rs 165 crore in the year-ago period.
The inclusion of Indian bonds in JPMorgan’s index is a positive development for the Indian bond market and is expected to attract significant foreign inflows. This is likely to benefit PNB Gilts and other primary dealers in government securities.
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