On Monday, the Finance Ministry disclosed plans to sell government bonds worth a cumulative Rs. 33,000 crore in three categories at an RBI auction set for January 12.
These categories include the “7.37 per cent Government Security 2028” valued at Rs. 7,000 crore, the “7.18 per cent Government Security 2033” valued at Rs. 16,000 crore, and the “7.30 per cent Government Security 2053” worth Rs. 10,000 crore. These auctions will utilize different price-based auction methods: uniform price method and multiple price method.
Additionally, there's an option for the government to retain an additional subscription up to Rs. 2,000 crore for each mentioned security.
The Reserve Bank of India will conduct these auctions on Friday. Approximately 5 per cent of the notified sale amount will be allocated to eligible individuals and institutions under the Scheme for Non-Competitive Bidding Facility in the Auction of Government Securities.
The official statement outlines the submission process: both competitive and non-competitive bids must be in electronic format through the Reserve Bank of India Core Banking Solution (E-Kuber) system on January 12, 2024. Non-competitive bids are to be submitted between 10.30 a.m. and 11 a.m., while competitive bids should be submitted between 10.30 a.m. and 11.30 a.m.
Results of the auctions will be disclosed the same day, with successful bidders expected to make payments by January 15.
These securities will be eligible for "When Issued" trading in accordance with RBI guidelines on 'When Issued transactions in Central Government Securities'.
(With Agency Inputs)
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