Eight states and union territories together mobilised Rs 17,800 crore through the latest state government securities (SGS) auction, according to data released by the Reserve Bank of India (RBI). The entire notified amount was accepted, signalling steady borrowing appetite among states and stable demand from investors.
Cut-off yields in the auction hovered around the 6.99-7.49% range, broadly reflecting a steady interest rate environment.
Among the major issuers, Madhya Pradesh was the largest borrower, raising a total of Rs 5,200 crore through two tranches — Rs 2,700 crore via a 21-year paper and Rs 2,500 crore through a 22-year bond, both at a yield of 7.40%. Haryana raised Rs 4,000 crore across four maturities, with yields ranging from 7.10% for 8 years to 7.38% for 16 years.
Punjab mobilised Rs 2,000 crore via a 15-year security at a cut-off yield of 7.49%, while Uttar Pradesh raised Rs 1,500 crore through a 14-year bond at 7.35%.
In the southern region, Tamil Nadu raised Rs 4,000 crore through three re-issues of its earlier securities. The state reissued its 6.99% 2032 bond at a price of 99.92, translating into a yield of 7.0043%, its 7.14% 2035 bond at 99.86 or a yield of 7.1596%, and its 7.44% 2055 bond at 100.61, implying a yield of 7.3884%.
Goa raised Rs 100 crore for a 12-year tenor at a yield of 7.28%, while Himachal Pradesh borrowed Rs 200 crore at 6.99% for 6 years. Jammu & Kashmir secured Rs 300 crore through a 17-year security at 7.41%, and Sikkim raised Rs 500 crore at 7.23% for a 10-year tenor.
The relatively narrow yield spread across maturities suggests stable investor demand and anchored inflation expectations ahead of the upcoming central and state borrowing rounds.