# The Debt Market at IFSC: Key Insights & Trends (2024-2025) Published: 15 May 2025 | Last updated: 22 Jul 2025 Author: Treelife Practice area: Reports Tags: Debt Market at GIFT City IFSC, Debt Market at IFSC Source: https://treelife.in/reports/the-debt-market-at-ifsc/ --- Blog Content Overview - [1 Market Size and Composition](#Market_Size_and_Composition) - [2 Instrument Analysis](#Instrument_Analysis) - [3 Sustainable Finance: ESG-Focused Instruments](#Sustainable_Finance_ESG-Focused_Instruments) - [4 Market Infrastructure & Participants](#Market_Infrastructure_Participants) - [5 Credit Rating Trends](#Credit_Rating_Trends) [5.0.1 Key Takeaways](#Key_Takeaways) - [6 Explore Opportunities at IFSC](#Explore_Opportunities_at_IFSC) **[DOWNLOAD PDF](https://treelife.in/wp-content/uploads/2025/05/The-Debt-Market-at-IFSC-Key-Insights-Trends-2024-2025.pdf)** The **International Financial Services Centre (IFSC)** at GIFT City has emerged as a pivotal platform for Indian financial institutions to tap into international capital markets. The **debt market at IFSC** showed impressive growth in FY 2024-25, with total issuances reaching **USD 6.99 billion** across 57 listings, underscoring its growing role as a global capital hub. This article provides an in-depth analysis of the trends, sectoral shifts, and emerging patterns shaping the debt landscape at IFSC. ## **Market Size and Composition** **Cumulative Issuance**: In FY 2024-25, GIFT IFSC facilitated **57 debt issuances**, totaling **USD 6.99 billion**, reflecting its strong presence in the global debt market. Although issuance volumes fluctuated throughout the year, the total issuance volume for the year remained significant, reinforcing IFSC’s role as a key player in global capital flow. **Sectoral Distribution**: The **Non-Banking Financial Companies (NBFCs)** dominated the market, accounting for **50 issuances** totaling **USD 5.23 billion**. This highlights IFSC’s critical role in facilitating funding for Indian financial institutions, especially NBFCs, that are leveraging international capital markets to fuel their growth. **Issuer Profile**: The top five issuers by volume in FY 2024-25 were: - **Muthoot Finance**: USD 650 million (9.3% of total issuance) - **Continuum Trinethra**: USD 650 million (9.3% of total issuance) - **State Bank of India**: USD 500 million (7.2% of total issuance) - **REC Limited**: USD 500 million (7.2% of total issuance) - **Shriram Finance**: USD 500 million (7.2% of total issuance) Together, these five issuers accounted for nearly **40%** of the total market volume, highlighting some concentration within the market. ## **Instrument Analysis** **Fixed vs Floating Rate**: The market exhibited a clear preference for **fixed-rate bonds**, which made up **95%** of the total value, with **22 issuances** totaling **USD 6.66 billion**. In contrast, **floating-rate bonds** represented only **5%** of the total value, with **35 issuances** totaling **USD 329.2 million**. This reflects a demand for larger, more stable issuances through fixed-rate bonds, while floating-rate bonds cater to more specialized, smaller funding needs. **Coupon Rates**: - **Fixed Rate Bonds**: Coupon rates ranged from **3.75% to 9.7%**, with an average rate of **6.63%**. - **Floating Rate Bonds**: Predominantly **SOFR-linked**, with spreads ranging from **SOFR + 0.95% to SOFR + 5.0%**, averaging **SOFR + 4.43%**. ## **Sustainable Finance: ESG-Focused Instruments** Sustainable finance has gained significant traction at IFSC. In FY 2024-25, **ESG-focused instruments** accounted for **39.4%** of the total debt issuance, with **green bonds** leading the charge. - **Green Bonds**: USD **1.455 billion** (20.8% of total issuance) - **Social Bonds**: USD **850 million** (12.1% of total issuance) - **Sustainable Bonds**: USD **450 million** (6.43% of total issuance) This shift towards sustainable finance underlines the increasing interest in **ESG investments** and positions IFSC as a hub for sustainable capital flow. ## **Market Infrastructure & Participants** The **trustee services** market at IFSC was split between **Indian** and **foreign trustees**. Key participants include global entities such as **BNY Mellon**, **Deutsche Bank**, and **Citicorp International**, along with Indian trustees like **Catalyst Trusteeship**. - **Foreign Trustees**: 17 issuances totaling **USD 5.415 billion**. - **Indian Trustees**: 36 issuances totaling **USD 1.15 billion**. This distribution shows the global and local participation in the IFSC debt market, further enhancing its accessibility to a wide range of institutional investors. ## **Credit Rating Trends** Out of the 57 issuances, **45.6%** were rated, representing **89.5%** of the total issuance volume. The ratings were predominantly **high yield (BB+ and below)**, with **20 issuances** amounting to **USD 4.63 billion**, while **investment-grade** bonds (BBB- and above) accounted for **6 issuances**, totaling **USD 1.63 billion**. #### **Key Takeaways** - **Growth in Debt Issuances**: IFSC continues to grow as a critical hub for global debt markets, with **USD 6.99 billion** raised in FY 2024-25. - **Sectoral Leadership**: NBFCs dominated the issuances, reflecting IFSC’s role in connecting Indian financial institutions to international markets. - **Rise of ESG**: Sustainable finance gained momentum, with **39.4%** of total issuances being ESG-focused instruments. - **Instrument Preferences**: **Fixed-rate bonds** remain dominant, while **floating-rate bonds** cater to specialized funding needs. - **Credit Rating Mix**: A balanced mix of **high-yield and investment-grade bonds** demonstrates the market’s attractiveness to a wide range of investors. ## **Explore Opportunities at IFSC** The debt market at IFSC is evolving rapidly, offering substantial opportunities for investors and issuers alike. 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