Seven Indian States to Raise 16,750 Crore Rupees in Bond Auction
Maharashtra leads a 16,750 crore rupee borrowing drive by seven state governments scheduled for September 22.
Seven Indian state governments will raise a combined 16,750 crore rupees through a bond auction on September 22. The Reserve Bank of India announced the details on Friday, September 18. Maharashtra is the largest borrower in this tranche. The state plans to raise 5,000 crore rupees through the issuance of state development loans. This auction provides a direct market access route for state-level fiscal funding.
Rajasthan follows with a borrowing target of 4,400 crore rupees. Andhra Pradesh aims to raise 2,600 crore rupees. Gujarat and Punjab will each borrow 2,000 crore rupees. Jammu and Kashmir has proposed 600 crore rupees in new debt. Goa will raise the smallest amount at 150 crore rupees. These funds are intended to meet the fiscal requirements of the respective state administrations.
State issuance breakdown details
Maharashtra will split its 5,000 crore rupee issuance across three tranches. The first tranche of 1,000 crore rupees involves the re-issue of 7.09 percent securities maturing in 2031. The second tranche of 2,400 crore rupees uses 7.63 percent securities maturing in 2039. The final tranche of 1,600 crore rupees utilizes 7.70 percent securities maturing in 2049. Re-issued securities maintain the original coupon rate from their initial issuance.
Rajasthan will raise 2,200 crore rupees each through re-issues maturing in 2044 and 2053. Andhra Pradesh will issue 1,000 crore rupees maturing in 2039 and 1,600 crore rupees maturing in 2051. Gujarat will divide its 2,000 crore rupee borrowing equally between maturities in 2036 and 2041. Punjab will issue fresh securities with five-year and 15-year maturities. Goa will issue a single new 15-year security for 150 crore rupees.
Retail access and bidding rules
Retail investors can participate in the auction through the RBI Retail Direct portal. The minimum investment is 10,000 rupees. Additional purchases must be in multiples of 10,000 rupees. Non-competitive bidding allows investors to buy at the weighted average yield. This yield is determined by the competitive auction process. A single non-competitive bid cannot exceed one percent of the total notified amount for a specific security.
Competitive bids are accepted between 10:30 AM and 11:30 AM IST on September 22. Non-competitive bids are accepted between 10:30 AM and 11:00 AM IST. The RBI will determine the cutoff yield based on market conditions. The auction results will be announced on the same day. These state development loans qualify as eligible investments under the statutory liquidity ratio framework.
Market mechanics and reporting
The auction will be conducted on E-Kuber, the RBI’s core banking platform. This system handles government securities transactions. Both competitive and non-competitive bidding facilities are available to eligible participants. Institutional investors submit competitive bids specifying the yield they are willing to accept. The RBI accepts bids starting from the lowest yield until the target amount is fully subscribed. GN auto markets/bonds: bond auction reports confirm the participation details for this specific transaction.
