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Key Points

States successfully raised nearly Rs 29,000 crore through government securities auctions conducted by the RBI. Rajasthan and Madhya Pradesh emerged as the largest borrowers with significant contributions from multiple states. The auction featured varying yields across different tenors, with Jammu & Kashmir paying the highest rate. Interestingly, Maharashtra chose not to accept any bids despite having four proposed issuances in the auction.

Key Points: States Raise Rs 28892 Crore in Government Securities Auction

  • Rajasthan leads with Rs 5000 crore across three securities with varying tenors
  • Madhya Pradesh raises Rs 4800 crore through 18-year and 20-year issuances
  • Maharashtra refrains from accepting any bids in four proposed issuances
  • Jammu & Kashmir pays highest yield at 7.82% for 17-year security
2 min read

States raise Rs 28,892 crore via government securities auction; Rajasthan, Madhya Pradesh lead borrowings

RBI auction sees states raise Rs 28,892 crore via government securities. Rajasthan and Madhya Pradesh lead borrowings with major contributions from multiple states.

"States and Union Territories mobilized Rs 28,892 crore through the auction of State Government Securities - Reserve Bank of India"

New Delhi, August 26

States and Union Territories mobilized Rs 28,892 crore through the auction of State Government Securities (SGS) on Tuesday, according to the Reserve Bank of India (RBI). However, the total notified amount for the auction was Rs 34,150 crore, but bids worth nearly Rs 5,258 crore were not accepted.RBI's auction results showed major contributions from states like Madhya Pradesh, Rajasthan, Kerala, and West Bengal, while Maharashtra refrained from accepting any bids in its four proposed issuances.Madhya Pradesh raised Rs 4,800 crore through two issuances, of Rs 2,300 crore at a cut-off yield of 7.57 per cent for an 18-year tenor and Rs 2,500 crore at the same yield for a 20-year tenor.Rajasthan raised Rs 5,000 crore across three securities of Rs 2,000 crore at 7.49 per cent for 10 years, Rs 1,500 crore at 7.57 per cent for 18 years, and Rs 1,500 crore at 7.54 per cent for 28 years, the longest tenor in the auction.Haryana accepted Rs 2,000 crore in two segments, including a fresh 14-year issuance at 7.52 per cent and a re-issue of 8.44 per cent Haryana SDL 2034 at a price of Rs 106.22 and a yield of 7.4409 per cent. Kerala raised Rs 1,988 crore, with Rs 988.007 crore accepted for 8-year securities at 7.52 per cent and Rs 1,000 crore for 25-year securities at 7.58 per cent.West Bengal borrowed Rs 3,500 crore, accepting Rs 2,000 crore at 7.77 per cent for 21 years and Rs 1,500 crore at 7.75 per cent for 22 years, among the higher yields in this auction.However, Maharashtra did not accept any bids in the proposed 4-year, 8-year, 9-year, and 10-year securities.

Tamil Nadu raised Rs 3,000 crore through three tranches of Rs 1,000 crore each: 4-year securities at 6.84 per cent, 6-year securities at 7.00 per cent, and a re-issue of 2035 bonds at a yield of 7.3112 per cent.

Telangana accepted Rs 2,000 crore through longer tenors — 26-year, 28-year, and 30-year securities — all priced at 7.54 per cent.

Gujarat raised Rs 2,000 crore at 7.25 per cent for a 9-year tenor, while Odisha borrowed Rs 1,000 crore at 7.50 per cent for an 8-year tenor.

Punjab accepted Rs 1,500 crore via a re-issue of 2050 bonds at a yield of 7.6088 per cent.

Smaller states also participated: Goa issued a 12-year security of Rs 100 crore at 7.40 per cent, Jammu & Kashmir raised Rs 300 crore via a 17-year issuance at the highest yield in the auction, 7.82 per cent, and Assam and Himachal Pradesh took part as well.

- ANI

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Reader Comments

P
Priya S
Interesting to see Maharashtra didn't accept any bids. Maybe they're waiting for better rates or have alternative funding arrangements. Smart financial management if that's the case.
A
Ananya R
West Bengal paying higher yields at 7.77% shows the market perceives higher risk there. Hope this borrowing is used productively for state development rather than just covering deficits.
K
Karthik V
Tamil Nadu got really good rates compared to others - 6.84% for 4 years is quite competitive. Shows strong financial credibility of the state government.
S
Sarah B
Nearly 29,000 crores in one auction! This shows the massive infrastructure investment happening across states. Hope this translates to better roads, schools, and hospitals for citizens.
N
Nikhil C
The variation in yields across states tells a story about their financial health and investor confidence. Smaller states like J&K paying 7.82% while Gujarat gets 7.25% - big difference in borrowing costs!

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