This notification from the Government of India, Ministry of Finance, Department of Economic Affairs, dated January 23, 2017, announces the sale reissue of the 7.06 percent Government Stock, 2046, for an aggregate amount of ₹2,000 crore nominal. The sale will be conducted through a price-based auction using a multiple price auction method via the Reserve Bank of India (RBI), Mumbai Office. Up to 5% of the notified amount will be allotted to eligible individuals and institutions through a non-competitive bidding facility.
The auction will be held on January 27, 2017, with non-competitive bids submitted between 10:30 a.m. and 11:30 a.m., and competitive bids between 10:30 a.m. and 12:00 noon via the RBI’s e-Kuber system. The stock is eligible for When Issued trading.
The stock has a thirty-year tenure commencing from October 10, 2016, and will be repaid at par on October 10, 2046. Payment by successful bidders is due on January 30, 2017, which includes accrued interest from October 10, 2016, to January 29, 2017. Interest at 7.06 percent per annum will be paid semi-annually on April 10 and October 10.
The result of the auction will be displayed by the RBI at its Mumbai office on January 27, 2017. This notification is issued by Order of the President of India, signed by Prashant Goyal, Joint Secretary to the Government of India. The General Notification F. No. 4 13WM2008, dated October 8, 2008, also applies to this sale.
Key Entities Referenced
Ministry of Finance: The ministry responsible for economic policy, financial regulation and fiscal affairs of India.
Department of Economic Affairs: A department within the Ministry of Finance responsible for advice on economic issues.
7.06 per cent Government Stock, 2046: A government security being reissued, maturing in 2046 with a coupon rate of 7.06%.
Reserve Bank of India: The central bank of India, responsible for conducting the auction and managing government securities.
Mumbai, Maharashtra: The city and state where the Reserve Bank of India office is located and where the auction will be conducted.
General Notification F. No. 4 13WM2008, dated October 8, 2008: A previously issued notification that specifies general terms and conditions relevant to the stock sale.
Scheme for Noncompetitive Bidding Facility in the Auctions of Government Securities: A scheme that allows eligible individuals and institutions to bid for a portion of the government stock without competitive bidding.
Prashant Goyal: Joint Secretary to the Government of India, signing the notification.
Government of India
Ministry of Finance
Department of Economic Affairs
Budget Division
New Delhi, dated January 23, 2017
NOTIFICATION
Auction for Sale (Re-issue) of ‘7.06 per cent Government Stock, 2046’
F. No.4 (3)-W&M/2016(iii): Government of India hereby notifies sale (reissue) of ‘7.06 per cent
Government Stock, 2046’ (hereinafter called 'the Stock') for an aggregate amount of ₹ 2,000
crore (nominal). The sale will be subject to the terms and conditions spelt out in this notification
(called ‘Specific Notification’) as also the terms and conditions specified in the General Notification
F. No. 4 (13)–W&M/2008, dated October 8, 2008 issued by Government of India.
Method of Issue
2. The Stock will be sold through Reserve Bank of India, Mumbai Office, Fort, Mumbai- 400 001 in
the manner as prescribed in paragraph 5.1 of the General Notification F. No. 4 (13)–W&M/2008,
dated October 8, 2008 by a price based auction using multiple price auction method.
Allotment to Non-competitive Bidders
3. The Government Stock up to 5 % of the notified amount of the sale will be allotted to eligible
individuals and institutions as per the enclosed Scheme for Non-competitive Bidding Facility in the
Auctions of Government Securities (Annex).
Place and date of auction
4. The auction will be conducted by Reserve Bank of India, Mumbai Office, Fort, Mumbai-400 001
on January 27, 2017. Bids for the auction should be submitted in electronic format on the Reserve
Bank of India Core Banking Solution (E-Kuber) system on January 27, 2017. The non-competitive
bids should be submitted between 10.30 a.m. and 11.30 a.m. and the competitive bids should be
submitted between 10.30 a.m. and 12.00 noon.
When Issued Trading
5. The Stock will be eligible for “When Issued” trading in accordance with the guidelines issued by
the Reserve Bank of India.
Tenure
6. The Stock will be of thirty-year tenure commencing from October 10, 2016. The Stock will be
repaid at par on October 10, 2046.
Date of issue and payment for the stock
7. The result of the auction shall be displayed by the Reserve Bank of India at its Fort, Mumbai office
on January 27, 2017. The payment by successful bidders will be on January 30, 2017, i.e., the
date of re-issue. The payment for the Stock will include accrued interest on the nominal value of the
Stock allotted in the auction from the date of original issue i.e., October 10, 2016 to January 29,
2017.
Interest
8. Interest at the rate of 7.06 per cent per annum will accrue on the nominal value of the Stock from
the date of original issue and will be paid half yearly on April 10 and October 10.
By Order of the President of India
(Prashant Goyal)
Joint Secretary to the Government of India