States raise Rs 11,625 crore through bond auction; Bihar accepts partial amount, Gujarat skips 10-year security
Mumbai, May 26
State governments collectively raised Rs 11,625.21 crore through the latest auction of State Government Securities conducted by the Reserve Bank of India, according to RBI data released on Tuesday.
The total notified amount for the auction was Rs 13,450 crore, although some states either partially accepted bids or did not accept bids for certain securities.
According to the RBI release, Bihar accepted only a partial amount of Rs 875.210 crore against the notified Rs 1,200 crore in the re-issue of 7.69 per cent Bihar SGS 2035 issued on April 29, 2026. Bihar also separately raised Rs 1,200 crore through a 15-year security at a cut-off yield of 7.84 per cent.
Chhattisgarh raised a total of Rs 1,000 crore through two separate securities. The state raised Rs 500 crore through the re-issue of 7.68 per cent Chhattisgarh SGS 2036 at a cut-off yield of 7.7900 per cent and another Rs 500 crore through the re-issue of 7.82 per cent Chhattisgarh SGS 2048 at a yield of 7.8624 per cent.
Madhya Pradesh raised a total of Rs 2,800 crore through two securities. The state raised Rs 1,600 crore through the re-issue of 7.64 per cent Madhya Pradesh SGS 2034 at a cut-off yield of 7.6999 per cent and another Rs 1,200 crore through the re-issue of 7.83 per cent Madhya Pradesh SGS 2048 at a yield of 7.8667 per cent.
Uttar Pradesh raised Rs 1,700 crore through two securities, including Rs 1,000 crore through the re-issue of 7.72 per cent Uttar Pradesh SGS 2036 at a cut-off yield of 7.7801 per cent and Rs 700 crore through the re-issue of 7.62 per cent Uttar Pradesh SGS 2041 at a yield of 7.8490 per cent.
Assam raised Rs 750 crore through the re-issue of 7.62 per cent Assam SGS 2041 at a cut-off yield of 7.8700 per cent. Kerala raised Rs 1,800 crore through the re-issue of 7.83 per cent Kerala SGS 2049 at a cut-off yield of 7.8680 per cent.
Gujarat did not accept any amount in its 10-year security auction, although it separately raised Rs 1,000 crore through a 12-year security at a yield of 7.74 per cent.
Uttarakhand did not accept any amount in the re-issue of 7.69 per cent Uttarakhand SGS 2036 issued on April 29, 2026, but raised Rs 500 crore through an 18-year security at a cut-off yield of 7.87 per cent.
The RBI conducts regular State Government Securities auctions to help states raise funds for infrastructure projects, development expenditure and other fiscal requirements.
The auction results reflected varying borrowing costs across states and maturities depending on investor demand and prevailing bond market conditions.
— ANI
Reader Comments
Madhya Pradesh raising Rs 2,800 crore—that's a big chunk! Hope it goes towards meaningful infrastructure like roads, schools, and hospitals. States need to be transparent about how this money is spent. The cut-off yields vary quite a bit, showing market perceptions differ.
Kerala at 7.8680% for 30-year bonds—that's a fairly high yield, reflecting perhaps the market's view on the state's fiscal health. Meanwhile, Gujarat got 7.74% for 12-year, which is lower. States with better finances get cheaper borrowing—simple economics. States need to improve their fiscal discipline.
Good that RBI is facilitating this, but I'm concerned about the rising state debt levels. Rs 11,625 crore in one auction! States need to focus on revenue generation too—GST collections, property taxes, etc. Can't keep borrowing forever. But for now, infrastructure development is crucial.
Chhattisgarh raising both 12-year and 22-year bonds—smart diversification of maturities. Madhya Pradesh also did two different tenures. Good to see states not putting all eggs in one basket. But the yields, especially for longer tenures around 7.86-7.87%, suggest investors want higher returns for longer commitment.
Why did Uttarakhand reject the 7.69% SGS 2036 but accept a similar-ish 7.87% for 18-year? Maybe the 10-year wasn't getting enough bids at the right price. Markets are getting picky—states need to offer competitive rates. Overall, this
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