What changed
RBI conducted a yield/price based auction for state government securities on June 23, 2026. The total amount accepted was ₹17,900 crore against the notified ₹16,900 crore, with Gujarat accepting additional bids. Cut-off yields varied by state and tenor, with re-issues of earlier dated securities for several states.
What it means for you
The auction saw oversubscription, indicating strong demand for state government securities. Banks and lenders can expect continued liquidity in state debt markets, with yields reflecting current market conditions. The additional acceptance by Gujarat suggests flexibility in state borrowing programs.
What you must do
- Review cut-off yields for state securities to assess market pricing trends.
- Monitor state borrowing programs for potential investment opportunities.
- Update internal valuation models with latest auction results.
- Engage with state treasuries for upcoming issuance schedules.
Who it affects
Banks holding state government securities, Primary dealers and market makers, State treasuries and finance departments, Institutional investors in state debt
What was the total amount accepted in this auction?
The total amount accepted was ₹17,900 crore, against the notified ₹16,900 crore, due to Gujarat accepting additional bids.
Which states participated in the auction?
Bihar, Chhattisgarh, Delhi, Gujarat, Himachal Pradesh, Kerala, Madhya Pradesh, Tamil Nadu, and Uttar Pradesh participated.
What were the cut-off yields for the securities?
Cut-off yields ranged from 7.38% (Tamil Nadu 2033) to 7.78% (Himachal Pradesh 18-year), varying by state and tenor.