skycfa

Based on secular analysis there may be a small premium embedded in the price (for the scarcity value), however, the overall option's effect would depend on valuation factors such as volatility that would most likely outweight any scarcity premium, so it would still probably trade at a discount to an otherwise identical non-callable bond. I think that it is just saying that the actual price may not purely reflect the valuation fundamentals because of the scarcity value based on demand. That's how I interpreted it anyway.