New Delhi [India], February 23 : The Reserve Bank of India (RBI) will conduct an auction of State Government Securities (SGS) on February 24, aggregating Rs 44,550 crore, according to an official notification issued by the central bank.
As many as 16 State Governments - Andhra Pradesh, Bihar, Chhattisgarh, Goa, Gujarat, Haryana, Karnataka, Kerala, Maharashtra, Nagaland, Punjab, Rajasthan, Sikkim, Tamil Nadu, Uttar Pradesh and West Bengal- are set to raise funds through a mix of fresh issuances and re-issues. The securities span maturities ranging from three years to 28 years, reflecting varied borrowing strategies aligned with states' fiscal requirements.
Several states are re-issuing existing securities, including dated stocks of Chhattisgarh (7.59% SGS 2046), Haryana (7.73% SGS 2045), Karnataka (7.25% SGS 2033), Tamil Nadu (7.12% SGS 2032 and 7.44% SGS 2055), Uttar Pradesh (7.24% SGS 2033 and 7.59% SGS 2041), and West Bengal (7.74% SGS 2048). Select states, such as Gujarat and Maharashtra, have also indicated additional borrowing through green-shoe options.
The auction will be conducted on RBI's Core Banking Solution (E-Kuber) platform. Competitive bids can be submitted between 10:30 am and 11:30 am on February 24, while non-competitive bids will be accepted between 10:30 am and 11:00 am. Eligible individuals and institutions may participate under the Non-Competitive Bidding Facility. Retail investors can also bid through the RBI Retail Direct portal.
Up to 10 per cent of the notified amount of each stock will be reserved for eligible participants under the non-competitive segment, subject to a maximum of 1 per cent per stock for a single bid. Bidders may submit multiple competitive bids at different yields or prices, provided the aggregate amount does not exceed the notified amount for the respective state.
The cut-off yield or minimum price will be determined by the RBI based on bids received. Securities will be issued in a minimum denomination of Rs 10,000 and in multiples thereof.
The auction results will be announced on the same day, and successful bidders will be required to make payments on February 25, 2026, during banking hours at Mumbai and the respective regional offices of RBI.
The newly issued stocks will carry interest at rates determined in the auction and will pay interest semi-annually on August 25 and February 25 until maturity. Re-issued securities will carry the original coupon rate. Investments in these securities qualify for Statutory Liquidity Ratio (SLR) purposes and are eligible for the ready forward facility under prevailing regulations.
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