According to a recent government notification, the government may accept further subscriptions of up to Rs 2,000 crore per security. The sale will be conducted through the Reserve Bank of India’s (RBI) Mumbai Office, utilizing its Core Banking Solution e-Kuber system.
The auction will use a multiple-price mechanism, allowing both competitive and non-competitive bids. Non-competitive bids will be accepted between 10:30 a.m. and 11:00 a.m. on October 10, while competitive bids will be taken from 10:30 a.m. to 11:30 a.m. on the same day. The auction results will be announced on October 10, and successful bidders must make their payments by Monday, October 13.
Primary Dealers can submit bids for underwriting the Additional Competitive Underwriting (ACU) portion between 9:00 a.m. and 9:30 a.m. on the day of the auction, October 10.
Additionally, the securities will be eligible for “When Issued” trading from October 7 to October 10, 2025.
As reported by news agency ANI, the auction process differs depending on the type of security. For multiple price-based auctions, successful bids are accepted at their respective quoted yield or price. In contrast, for uniform price-based auctions, all accepted bids are settled at the cutoff yield or price.
The RBI has stated that auctions will be yield-based for new securities and price-based for reissued securities. In the case of Floating Rate Bonds (FRBs), the auction will be spread-based for new securities and price-based for reissues. When placing bids for new FRBs, bidders should quote the spread in percentage terms.
Furthermore, the RBI release highlights that securities will be issued in a minimum amount of Rs 10,000 and in multiples of Rs 10,000 thereafter.
To summarize the key timings:
– ACU portion underwriting bids by Primary Dealers: 9:00 a.m. to 9:30 a.m. on October 10
– Non-competitive bids: 10:30 a.m. to 11:00 a.m. on October 10
– Competitive bids: 10:30 a.m. to 11:30 a.m. on October 10
– Auction results announcement: October 10
– Payment due by winning bidders: October 13
This issuance reflects the continued efforts by the government and RBI to maintain transparent and efficient debt markets through advanced auction mechanisms.
https://www.mid-day.com/news/india-news/article/rbi-to-auction-government-securities-worth-rs-28000-crore-on-october-10-23597604