Executive Summary:
The Government of India announces the sale/reissue of four Government Stocks via auction conducted by the Reserve Bank of India (RBI) on June 07, 2019. The total notified amount is Rs 17,000 crore, with an option to retain additional subscriptions up to Rs 1,000 crore for each security. Payment by successful bidders is due on June 10, 2019.
Key Points / Main Content:
Auction Details:
* Auction is for the sale/reissue of four Government Stocks maturing in 2024, 2029, 2043 and 2049.
* Auction will be conducted by the Reserve Bank of India (RBI), Mumbai on June 07, 2019.
* Bids must be submitted electronically via the RBI's E-Kuber system on June 07, 2019.
* Non-competitive bids: 11:30 a.m. to 12:00 noon; Competitive bids: 11:30 a.m. to 12:30 p.m.
Securities Offered:
* 7.32 GS 2024: Maturity Date - Jan 28, 2024, Notified Amount - Rs 5,000 Crore.
* 7.26 GS 2029: Maturity Date - Jan 14, 2029, Notified Amount - Rs 6,000 Crore.
* 7.69 GS 2043: Maturity Date - Jun 17, 2043, Notified Amount - Rs 2,000 Crore.
* 7.72 GS 2049: Maturity Date - Jun 15, 2049, Notified Amount - Rs 4,000 Crore.
Subscription and Allotment:
* Government has the option to retain additional subscriptions up to Rs 1,000 crore against any one or more securities, subject to a total limit of Rs 17,000 crore.
* Up to 5% of the notified amount is reserved for allotment to eligible individuals and institutions via a non-competitive bidding facility.
Payment and Interest:
* Payment by successful bidders is due on June 10, 2019.
* Interest accrues from the original issue date/last coupon payment date and is paid semi-annually.
* Stocks will be repaid at par on the maturity date.
Other Details:
* The stocks are eligible for When Issued trading, per RBI guidelines.
* Auction results will be displayed at the RBI, Mumbai office on June 07, 2019.
Impact Analysis:
Eligible Individuals and Institutions:
* Impact: Opportunity to invest in Government Stocks through the non-competitive bidding facility.
* Action Required: Submit non-competitive bids between 11:30 a.m. and 12:00 noon on June 07, 2019, via the RBI's E-Kuber system.
Bidders (including Banks, Financial Institutions, and Primary Dealers):
* Impact: Opportunity to participate in the auction for Government Stocks.
* Action Required: Submit competitive bids between 11:30 a.m. and 12:30 p.m. on June 07, 2019, via the RBI's E-Kuber system and ensure payment by June 10, 2019, if successful.
Reserve Bank of India (RBI):
* Impact: Responsible for conducting the auction and announcing the results.
* Action Required: Conduct the auction on June 07, 2019, display results at the Mumbai office, and manage the payment process.
Key Entities Referenced
Ministry of Finance: The ministry responsible for financial matters of the Government of India.
Department of Economic Affairs: A department within the Ministry of Finance, Government of India.
Reserve Bank of India: The central bank of India, responsible for conducting auctions of government stocks.
Government Stock: Debt instruments issued by the Government of India.
7.32 GS 2024: Government Stock with a coupon rate of 7.32% maturing in 2024.
7.26 GS 2029: Government Stock with a coupon rate of 7.26% maturing in 2029.
7.69 GS 2043: Government Stock with a coupon rate of 7.69% maturing in 2043.
7.72 GS 2049: Government Stock with a coupon rate of 7.72% maturing in 2049.
Government of India
Ministry of Finance
Department of Economic Affairs
Budget Division
New Delhi, dated June 03, 2019
NOTIFICATION
Auction for Sale (re-issue) of Government Stock (GS)
F.No.4(6)W&M/2019: Government of India(GoI) hereby notifies sale (re-issue) of the following Government Stocks:
Date of Tenure Date of Notified Amount
Name of the Security Base Method
Original Issue (yy-mm-dd) Maturity (in Rs Crore)
7.32% GS 2024 Jan 28, 2019 05-00-00 Jan 28, 2024 Price Multiple 5,000
7.26% GS 2029 Jan 14, 2019 10-00-00 Jan 14, 2029 Price Multiple 6,000
7.69% GS 2043 Apr 30, 2019 24-01-17 Jun 17, 2043 Price Multiple 2,000
7.72% GS 2049 Apr 15, 2019 30-02-00 Jun 15, 2049 Price Multiple 4,000
Subject to the limit of `17000 Cr, being total notified amount, GoI will have the option to retain additional subscription
up to `1000 Cr each against any one or more of the above securities. The sale will be subject to the terms and
conditions spelt out in this notification (called ‘Specific Notification’). The Stock will be sold through Reserve Bank of
India, Mumbai Office, Fort, Mumbai- 400 001 as per the terms and conditions specified in the General Notification
F.No.4(2)–W&M/2018, dated March 27, 2018 issued by Government of India.
Allotment to Non-competitive Bidders
2. 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
3. The auction will be conducted by Reserve Bank of India, Mumbai Office, Fort, Mumbai -400 001 on June 07, 2019.
Bids for the auction should be submitted in electronic format on the Reserve Bank of India Core Banking Solution (E-
Kuber) system on June 07, 2019. The non-competitive bids should be submitted between 11.30 a.m. and 12.00 noon
and the competitive bids should be submitted between 11.30 a.m. and 12.30 pm.
When Issued Trading
4. The Stock will be eligible for “When Issued” trading in accordance with the guidelines issued by the Reserve Bank
of India.
Date of issue and payment for the stock
5. The result of the auction shall be displayed by the Reserve Bank of India at its Fort, Mumbai Office on June 07,
2019. The payment by successful bidders will be on June 10, 2019 i.e. the date of re-issue. The payment for the
stocks will include accrued interest on the nominal value of the Stock allotted in the auction from the date of original
issue / last coupon payment date to the date upto which accrued interest is due as mentioned in the table in para 6.
Payment of Interest and Re-payment of Stock
6. Interest will accrue on the nominal value of the Stock from the date of original issue / last coupon payment and
will be paid half yearly. The Stock will be repaid at par on date of maturity.
Name of the Coupon rate Date of Last Coupon Date upto which Date of Coupon
Security (%) payment accrued interest is due payments
(month / date)
7.32% GS 2024 7.32 New Security June 09, 2019 Jul 28 and Jan 28
7.26% GS 2029 7.26 New Security June 09, 2019 Jul 14 and Jan 14
7.69% GS 2043 7.69 New Security June 09, 2019 Jun 17 and Dec 17
7.72% GS 2049 7.72 New Security June 09, 2019 Jun 15 and Dec 15
By Order of the President of India
(Arvind Shrivastava)
Joint Secretary to the Government of India