Research Report

Eleven state governments and one Union Territory (UT) raised Rs. 236 billion through state government securities (SGS) on October 6, 2026, ~6% below the amount indicated in the Q3 FY2027 auction calendar. Notably, Delhi did not accept any bids for its 7-year (Rs. 5 billion) and 15-year (Rs. 5 billion) papers and Punjab declined bids for its 5-year paper (Rs. 5 billion). In today’s SGS auction, nearly a third of the total issuance amount was raised by Maharashtra (Rs. 72 billion). In the auction of October 6, 2026, ~70% of the total borrowing was issued in longer tenors, ~25% in shorter tenors and the balance ~5% in the 10-year bucket. The weighted average tenor of all SGS issued in the auction held on October 6, 2026 declined to 16 years from 19 years last week. The weighted average SGS cut-off rose to 7.96% (highest since July 2022) in the auction held on October 6, 2026, from 7.93% last week, reflecting a broader trend of hardening rates in the bond market.

EXHIBIT: Indicated and actual SGS issuances in FY2027 so far