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One of the most important concepts to understand is the Yield to Maturity (YTM), which represents the total annualized return an investor can expect if the bond is held until its maturity. YTM takes into account the bond’s current market price, its periodic coupon payments, and the time remaining until maturity. It is important to note that YTM is not a guaranteed return—it can fluctuate based on factors such as changes in market interest rates, liquidity conditions, time to maturity, and the creditworthiness of the issuer. Also, if the bond is sold before maturity, the actual return may differ significantly from the indicated YTM. Generally, when a bond’s price is below its face value, its YTM is higher than its coupon rate, and vice versa.

The coupon rate of a bond refers to the fixed annual interest paid by the issuer, calculated as a percentage of the bond’s face value. This provides regular income to investors, usually on a semi-annual or annual basis. However, these payments are not risk-free—they are dependent on the financial health and credit reliability of the issuer. Any delay or default in payments can adversely affect investor returns.

It is also essential to understand the relationship between bond prices and yields, which move in opposite directions. When interest rates in the market rise, bond prices fall, leading to higher yields, and when interest rates fall, bond prices increase, lowering the yield. This inverse relationship is fundamental to assessing interest rate risk and understanding potential price movements in the secondary market.

Brokerage reversal or zero brokerage can have a direct impact on the YTM by lowering the overall cost of investment, thereby slightly enhancing the effective return. The final return should always be assessed after considering all associated costs, fees, and applicable taxes.

Before investing through any online bond platform, investors must take into account several important factors such as checking the bond’s credit rating, the issuer’s track record in timely repayments, the liquidity of the instrument, settlement timelines, and the tax implications of the investment. Additionally, it is crucial to verify that the platform is a SEBI-registered Online Bond Platform Provider (OBPP). Investors should carefully read platform disclaimers, understand the terms and conditions, and ensure that transactions are carried out through properly regulated and secure systems.

Investors are advised that the risk and return on corporate bond investment vary based on the credit rating of the instruments. A rating-wise risk scale, similar to mutual funds risk-o-meter, may be considered.

Lack of awareness or understanding of these aspects can result in misjudged risks and potential capital loss. Therefore, investors are strongly advised to conduct due diligence before proceeding with any bond investment.

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The Reserve Bank of India (RBI) recently frontloaded its monetary policy easing, slashing the repo rate by 50 basis points to 5.5%. In a surprise move, it also reduced the Cash Reserve Ratio by 100 basis points to infuse liquidity and stimulate credit growth. As deposit rates begin to soften in response, money market funds offer a compelling alternative to traditional fixed deposits for parking short-term surplus cash.

“As we enter a phase of front-loaded policy easing, money market funds present a smart allocation option for investors. With the repo rate now at 5.5%, investors can potentially earn 50–75 basis points over the repo in money market funds, while maintaining liquidity and limiting volatility,” said Amit Somani, Deputy Head – Fixed Income, Tata Asset Management.

According to the Association of Mutual Funds in India (AMFI), the category received cumulative inflows of Rs 42,730 crore in April and May 2025, underscoring investor confidence in the product. Reflecting this trend, the Tata Money Market Fund saw inflows of Rs 1,684 crore from Bengaluru in the last two months. In FY25, investments from the city increased by more than 2x to Rs 7,544 crore from Rs 3,110.3 crore in FY24, contributing to the fund’s milestone of Rs 30,000 crore in assets under management (AUM).

Money market funds invest in instruments such as Treasury bills, commercial paper, and certificates of deposit, offering a balance of stability and yield. The Tata Money Market Fund’s performance is anchored in disciplined duration management and a focus on high-credit quality issuers. As short-term rates continue to ease, such funds present a strong case for inclusion in both strategic and tactical asset allocation strategies.

While both liquid and money market funds serve short-term needs, the latter—with maturities extending up to 6–9 months—may offer slightly better yields for investors with a short- to medium-term outlook. Choosing between them depends on the investor’s time horizon and risk appetite, but both remain attractive tools in the current policy landscape.

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Strategic Location and Infrastructural Development

The government’s focus on improving infrastructure in tier-2 cities is visibly bearing fruit in Sonipat. The Urban Infrastructure Development Fund (UIDF), managed by the National Housing Bank, is set to boost the creation of urban amenities, making Sonipat more attractive to residents and businesses. Additionally, the city’s inclusion in the Delhi-Mumbai Industrial Corridor (DMIC) promises substantial industrial growth, with plans for smart industrial parks and logistic hubs that are expected to generate significant employment and boost the local economy.

With improved infrastructure and connectivity, Sonipat’s real estate market is experiencing a significant transformation. Affordable land and lower cost of living are attracting both developers and buyers, leading to the emergence of organized housing projects and commercial spaces. The government’s Make in India initiative has been a significant catalyst, with several manufacturing units setting up shop in and around Sonipat. This has led to commercial real estate witnessing robust growth with the development of new offices, retail spaces, and industrial complexes. As more businesses and educational institutions establish their presence, the demand for both residential and commercial properties is expected to surge. Major real estate players recognize the potential and are investing heavily in large-scale developments.

Mr. Rahul Singla, Director of Mapsko Group said, “Sonipat is on the brink of a real estate revolution. The city’s evolving infrastructure, coupled with its strategic location near Delhi, makes it a hotbed for investors looking for substantial returns on investment. The burgeoning demand for quality residential and commercial properties in Sonipat is fueled by a combination of affordability, spacious layouts, and a better quality of life compared to the crowded metropolitan areas. With the rise of remote working models is encouraging more people to move away from traditional city centers. Every month, Sonipat is attracting not only locals but also people from Delhi and other metros who are looking for a peaceful yet connected place to settle. Sonipat’s emergence as a prime destination for real estate investment is attributed in large part to the city’s burgeoning plotted developments, which offer homebuyers spacious layouts and the opportunity to customize their dream homes. These plotted developments cater to the preferences of modern homebuyers, who prioritize both affordability and lifestyle quality. The well-planned plotted development in Sonipat is reshaping the real estate landscape, making the city the preferred choice for individuals seeking to invest in or settle down in a peaceful yet connected environment.”

Commenting on the evolving market dynamics, Mohit Malhotra, Founder & CEO of NeoLiv, an integrated residential real estate platform, remarked, “NeoLiv embraces a forward-looking ethos, where innovation and opportunity intersect. We envision that new age cities like Sonipat will become the crucibles of future economic dynamism. Their appeal lies in a harmonious mix of affordability, accessibility, and lifestyle amenities, offering new relaxed havens of living. As living preferences evolve and government initiatives take root, these cities are uniquely positioned to reshape the real estate narrative, attracting investors, homeowners, and businesses alike. With the emergence of large global level industries such as the upcoming Maruti Suzuki plant in vicinity of Sonipat belt, these locations are poised to drive demand for mid-income housing projects and plotted developments, transforming into vibrant residential neighbourhoods”

NRI Interest and Future Outlook

Sonipat exemplifies the potential of tier-2 cities in India as engines of economic and real estate growth. With its strategic location, burgeoning infrastructure, and increasing governmental focus, Sonipat offers a unique and lucrative opportunity for investors. The interest in Sonipat is not limited to domestic buyers and investors. Non-resident Indians (NRIs), particularly those with roots in Haryana, are increasingly looking at Sonipat as a viable option for investment. The upcoming infrastructure projects and the potential for substantial property appreciation make it an attractive market for long-term investments. Sonipat’s real estate sector is poised for exponential growth. As urban growth continues to push outward from India’s overcrowded metros, Sonipat stands out as a model of sustainable development and a beacon for future investment. The transformation of Sonipat into a coveted real estate hub is driven by strategic investments and government support, and signifies a new horizon for real estate investors.

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Although the decline in the investment climate in India was due to a conservative shift in investment strategies due to increasing investor caution in the face of rising geopolitical tensions and interest rates, total PE investment in the real estate sector reached $5.6 billion in 2023, a growth of 5.3 per cent over the previous year.

Across the sector, the office sector accounted for the largest share of all PE investments at 68 per cent, followed by warehousing at 21 per cent and residential at 11 per cent. This is a 20 per cent decline from H1 2022, as PE investors took a cautious approach in H1 2023, resulting in a conservative shift in investment strategies.

Despite prevailing global concerns impacting investment, growth has slowed only to a limited extent and is expected to rebound in the second half of 2023. Overall, PE investment in India’s real estate sector is estimated to reach $5.6 billion in 2023, representing a year-on-year growth of 5.3%. The decline in investments is the result of a conservative shift in investment strategies.

The report data showed that PE ‘s investments in the Indian office sector reached a staggering USD 1.8 billion in the first half of 2023. Although investments from PE continued to lead in the first half of 2023, accounting for a 68% share of total investments, this dominance was supported by the resilience of investable office real estate. PE investment in the office sector registered a 24 per cent year-on-year increase during the period, driven primarily by a large deal worth $1.4 billion between GIC and Brookfield India Real Estate Trust REIT. About 80 per cent of the investment was in completed properties, while 20 per cent was in new and under-construction projects. Mumbai, NCR and Bengaluru emerged as leading office investment destinations in the first half of 2023.

According to the report, the residential sector attracted PE investments $277 million in investments during the same period. The investments were largely residential projects that were still under construction and targeted early-stage investments for better returns. A total of 82 per cent of PE was invested in the housing sector by foreign PE. NCR and Bengaluru emerged as the leading investment destinations, driven by development stage transactions involving prominent global players. Though India’s retail sector did not see PE investment during this H1 2023 period, listing of a retail company REIT would lead to increased investor interest, with tier metros II having more appeal.

Though India’s retail sector did not see PE investment during this H1 2023 period, listing of a retail company REIT would lead to increased investor interest, with tier II metros having more appeal. Investor interest in the retail sector has expanded beyond major metropolitan cities in the last decade. Markets like Chandigarh attracted investments of $267 million, Nagpur and Amritsar $100 million each, Indore $61 million and Bhubaneshwar $46 million.

However, the warehouses segment witnessed a decline in the first half of 2023 with an amount of $555 million compared to $1.2 billion in the first half of 2022. According to the report, lack of supply of quality facilities contributed to the slowdown in investments in the sector. Across India, Mumbai saw the highest investment at 48%, with NCR second at 32% and Bengaluru at 13%. Nearly 75% of investments came from Asian countries in H1 2023, compared to 86% of investments from Canada and the US in H1 2022.

Shishir Baijal, Chairman & Managing Director, Knight Frank, said, “India’s economic growth in the last few quarters has been a strong reason for long-term confidence among global investors. However, we have seen a decline in investment volumes over the past year due to global economic challenges that have led some major economies to take drastic fiscal and monetary measures. This has prompted investors to re-evaluate their strategies, at least in the short term. The Indian office sector continues to attract investors, especially when it comes to high-yielding assets. Unlike other global gateway markets, India has seen steady growth momentum, which has boosted investor confidence in the sector. Looking ahead, the office sector is likely to remain a favorited among investors, as it is expected to maintain its momentum in the short to medium term.”

The office segment has been PE investors’ preferred choice for investment in the first half of 2023, mainly due to the resilience of high-quality office properties. The report forecasts factors such as government investment, currency fluctuations, inflation, interest rates and office supply to drive 5.3% annual growth in PE investment in India in 2023 to $5.6 billion. The outlook for PE investment in Indian office real estate remains positive. As global headwinds ease, the resilience of the Indian economy and the favorable economics of real estate investments will have a positive impact on PE investment activity in the sector, the report said.

-SURESH RATHOD

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The lower circuit in the Indian markets was triggered for the first time since the 2008 global financial crisis. The next circuit breaker limit for the benchmark indices is at 15 per cent.

Investors continued to panic over the impact of the fast-spreading coronavirus outbreak on global growth, say analysts.

The rupee dropped to a record low on Friday, weighed down by worries over the coronavirus pandemic that has prompted investors to dump riskier assets and move towards safe havens.

Equities in other Asian markets went into a free-fall, with Japan’s Nikkei 225 index dropping 10 per cent, and heading for its worst week since the 2008 global financial crisis. MSCI’s broadest index of Asia-Pacific shares outside Japan fell 2 per cent.

Analysts say that global economy is likely to bear the brunt of the coronavirus pandemic as the number of cases soars and policymakers scramble to shield major economies from the outbreak.

The selloff gathered pace after US President Donald Trump’s announcement to ban travel from Europe spooked investors, and after the European Central Bank disappointed markets by holding back on rate cuts.

Concerns over the virus have hammered financial markets and disrupted businesses globally as countries around the world grapple with how to contain the outbreak and its economic impact.

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