Six state governments raised Rs. 153 billion through state government securities (SGS) on August 11, 2026, ~30% below the indicated amount in the Q2 FY2027 auction calendar, following the double tranche of tax devolution released to states in August 2026. Notably, Punjab did not accept bids for its greenshoe option of Rs. 5 billion. The actual issuance by states that had adopted the Benchmark Issuance Strategy (BIS) was in line with their indicated amounts for this auction, except for Telangana (did not participate even though had indicated to raise Rs. 25 billion). In addition, Goa, Haryana, Jammu & Kashmir and Tamil Nadu did not participate even though they had previously indicated they would raise Rs. 66 billion. In contrast, Gujarat issued SGS worth Rs. 25 billion even though it had not indicated its participation in today’s auction.

• In the auction held on August 11, 2026, ~63% of the total borrowing was issued in longer tenors and the balance ~37% in shorter tenors. The weighted average tenor of all SGS in the auction held on August 11, 2026 eased mildly to 16 years from 17 years last week. The weighted average SGS cut-off eased to 7.54% in the auction held on August 11, 2026, from 7.57% last week.
• On a cumulative basis, the SGS issuance stands at Rs. 3.4 trillion in FY2027 till date, a mild ~3% above the Rs. 3.3 trillion raised in the same period in the previous year. Notably, the actual borrowings were 16% below the Rs. 4.1 trillion planned for this period, mainly on account of a 20% shortfall in Q1 FY2027.