RBI’s New Norms Push ARCs Into Strategy Overdrive
The Government of India has announced the auction of two dated securities worth Rs 25,000 crore, according to an official notification issued by the Reserve Bank of India (RBI). The auction will include a new Government Security (GS) maturing on July 14, 2032, valued at Rs 11,000 crore, and a re-issue of the 7.09% GS maturing on November 25, 2074, worth Rs 14,000 crore. Additionally, the government may retain up to Rs 2,000 crore in extra subscription for each security.
This auction is scheduled for Friday, July 11, 2025, and will be conducted through the e-Kuber system at RBI’s Mumbai office. Settlement of the auction is slated for Monday, July 14, 2025.
Dated securities are long-term government bonds that carry fixed maturity dates and interest rates, paying interest at regular (typically half-yearly) intervals. A re-issue refers to the fresh sale of an already issued bond, maintaining its original terms, to raise additional funds.
The auction will follow a multiple-price method, allowing both competitive and non-competitive bids. Non-competitive bids can be submitted between 10:30 a.m. and 11:00 a.m., while competitive bids are allowed from 10:30 a.m. to 11:30 a.m. The results will be announced the same day, and successful bidders must pay by the settlement date.
Primary Dealers may also bid for underwriting the Additional Competitive Underwriting (ACU) portion between 9:00 a.m. and 9:30 a.m. on the auction day. These securities are eligible for “When Issued” trading from July 8 to July 11, and will be issued in denominations of Rs 10,000 and multiples thereof.
Up to 5% of each security’s notified amount is reserved for eligible individuals and institutions under the non-competitive bidding facility, accessible via the Retail Direct portal. The RBI also allows physical bids in exceptional cases of technical failures. Investors may place multiple competitive bids, as long as the total does not exceed the notified amount.
These securities provide an opportunity for both institutional and retail investors to participate in government financing, with steady returns and regulatory oversight.
(From ANI)
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