In the last weekly auction of FY2026, 11 state governments raised Rs. 400 billion (including greenshoe) through state government securities (SGS) on March 27, 2026, 3.3x the amount indicated in the Q4 FY2026 auction calendar. The issuance was lower than the notified amount on account of non-acceptance/partial acceptance of bids by Assam, Gujarat, Tamil Nadu, Uttar Pradesh, Uttarakhand and West Bengal. Overall, the gross SGS issuance for FY2026 stands at Rs. 12.8 trillion, modestly above ICRA’s expectations of Rs. 12.5 trillion. On a YoY basis, gross SGS issuance rose by 18.9% in FY2026, while being a mild ~5% below the indicated amount of Rs. 13.4 trillion. The weighted average SGS cut-off rose by 23 bps to 7.92% (highest since Aug 2022) on March 27, 2026 from 7.69% last week, amid the weighted average tenor rising to 18 years from 14 years. However, the spread between the cut-off yield of the 10-year SGS and the 10-year G-sec (06.48 GS 2035) was unchanged at 78 bps as on March 27, 2026 from last auction.

EXHIBIT: Indicated and actual SGS issuances in Q4 FY2026

Source: RBI, ICRA Research