SBI-backed Auction: ₹16,900 Crore in State Government Securities Up For Grabs by RBI

SBI-backed Auction: ₹16,900 Crore in State Government Securities Up For Grabs by RBI​

Massive Spectrum of State Securities Offered at RBI Auction​

The Reserve Bank of India (RBI) has announced a large-scale auction for various State Government Securities (SGS), totaling an aggregate face value of ₹16,900 Crore. This comprehensive offering includes stocks from nine states and several Union Territories, presenting diverse investment opportunities to eligible individuals and financial institutions.

The auction encompasses securities ranging from re-issued bonds in specific states like Bihar, Chhattisgarh, Madhya Pradesh, and Tamil Nadu, to new issues across numerous state governments. The offerings are classified into both Price-based and Yield-based auctions, catering to different investor strategies.

Key State Governments Participating in the Offering​

A significant number of states have participated in this auction event. Featured among the participants are Delhi, Gujarat, Himachal Pradesh, Kerala, Madhya Pradesh, Tamil Nadu, Uttar Pradesh, Bihar, and Chhattisgarh. Each state has provided a specific amount for sale, facilitating varied investment choices.

The offering includes substantial amounts from Kerala (₹1800 Crore) and Madhya Pradesh (totaling ₹2800 Crore across two tranches). Delhi's participation offers opportunities in both 10-year and 15-year maturity securities, with a corresponding additional borrowing option available.

Auction Mechanics and Timeline for Investors​

The auction is scheduled to be conducted on the RBI Core Banking Solution (E-Kuber) system on Tuesday, June 23, 2026. Investors must submit both competitive and non-competitive bids electronically through the designated system.

Specific submission timings are mandated for each type of bid. Competitive bids are required to be submitted between 10:30 A.M. and 11:30 A.M., while non-competitive bids must be placed by 11:00 A.M. on the same day.

Investment Details and Market Eligibility​

The offering provides investors with a clear understanding of the terms and rules governing the purchase. The RBI will determine the maximum yield or minimum price at which all bids will be accepted. Each stock will be issued for a minimum nominal amount of ₹10,000.00, followed by multiples of ₹10,000.00.

The investment opportunity is robustly structured to support national financial stability. The stocks are designated as eligible investments in Government Securities (GS) for banks regarding the Statutory Liquidity Ratio (SLR). Furthermore, these securities qualify for the ready forward facility.

Investor Access and Contingency Planning​

Individuals seeking to participate can place bids via the Retail Direct portal at https://rbiretaildirect.org.in through the non-competitive scheme. The maximum allocation limit under the 'Scheme for Non-competitive Bidding Facility' is set at one percent of the notified amount per stock per single bid.

While E-Kuber is the primary platform, contingency plans are in place for technical failure. If a system failure occurs, physical bids will be accepted by submission to the Public Debt Office before the auction timing concludes.

Interest and Payment Structure Post-Auction​

The new State Government Stocks will bear interest rates determined by RBI at the time of the auction. For these new stocks, interest payments are set for half-yearly intervals on December 24 and June 24 until maturity.

For the re-issued Government Stock, interest will be paid based on the rate determined when the stock was originally issued. This payment will also occur on a half-yearly basis throughout the tenure of the security. The securities are governed by the provisions of the Government Securities Act, 2006 and related Regulations.