In the last weekly auction of Q3 FY2026, 15 state governments raised Rs. 355 billion (largest so far in FY2026) through state government securities (SGS) on December 30, 2025. This was more than double the amount that was initially indicated for this week. Despite the large sized auction, the weighted average SGS cut-off eased to 7.41% on December 30, 2025 from 7.44% last week while the weighted average tenor of all SGS remained unchanged at 12 years. However, the spread between the cut-off yield of the 10-year SGS and the 10-year G-sec (06.48 GS 2035) widened to 90 bps as on December 30, 2025 from 86 bps in the previous weekly auction. Total issuance in Q3 FY2026 was 10% lower than the amount indicated for this quarter, but 11% higher than in Q3 FY2025.

EXHIBIT: Indicated and actual SGS issuances in Q3 FY2026

Source: RBI, ICRA Research