Executive Summary:
The Government of India announces the sale/reissue of multiple Government Stocks via auction to be conducted by the Reserve Bank of India (RBI) on December 28, 2018. Bids must be submitted electronically through the RBI's e-Kuber system on the specified date, with payment due on December 31, 2018. The total notified amount for the sale is ₹12,000 Crore.
Key Points / Main Content:
* **Sale/Reissue of Government Stocks:**
* Government of India will sell/reissue government stocks.
* The stocks include: 7.37 GS 2023, 7.17 GS 2028, 8.24 GS 2033 and 7.06 GS 2046.
* The total notified amount is ₹12,000 Crore.
* GoI has the option to retain additional subscription up to ₹1,000 Crore against any one or more of the above securities.
* **Auction Details:**
* The auction will be conducted by the Reserve Bank of India (RBI) in Mumbai.
* Date of Auction: December 28, 2018.
* Bids must be submitted electronically via the RBI's e-Kuber system.
* Non-competitive bids: 11:30 a.m. to 12:00 noon.
* Competitive bids: 11:30 a.m. to 12:30 p.m.
* **Allotment to Non-Competitive Bidders:**
* Up to 5% of the notified amount will be allotted to eligible individuals and institutions as per the Scheme for Non-competitive Bidding Facility.
* **When Issued Trading:**
* The Stock will be eligible for When Issued trading as per RBI guidelines.
* **Payment and Issue Date:**
* Payment by successful bidders is due on December 31, 2018.
* Payment includes accrued interest from the original issue/last coupon payment date.
* **Interest and Repayment:**
* Interest will accrue on the nominal value of the stock and will be paid half-yearly.
* The stock will be repaid at par on the maturity date.
* **Coupon Payment Details:**
* 7.37 GS 2023: Coupon rate 7.37, payments on Apr 16 and Oct 16; accrued interest due up to Dec 30, 2018.
* 7.17 GS 2028: Coupon rate 7.17, payments on Jan 08 and July 08; accrued interest due up to Dec 30, 2018.
* 8.24 GS 2033: Coupon rate 8.24, payments on May 10 and Nov 10; accrued interest due up to Dec 30, 2018.
* 7.06 GS 2046: Coupon rate 7.06, payments on Apr 10 and Oct 10; accrued interest due up to Dec 30, 2018.
Impact Analysis:
* **Eligible Individuals and Institutions (Non-Competitive Bidders):**
* Impact: Opportunity to participate in the auction of government securities with a reserved allocation.
* Action Required: Submit non-competitive bids between 11:30 a.m. and 12:00 noon on December 28, 2018, through the RBI's e-Kuber system, adhering to the Scheme for Non-competitive Bidding Facility.
* **Banks, Financial Institutions, and Other Competitive Bidders:**
* Impact: Opportunity to acquire government stocks through competitive bidding.
* Action Required: Submit competitive bids between 11:30 a.m. and 12:30 p.m. on December 28, 2018, via the RBI's e-Kuber system. Successful bidders must make payment by December 31, 2018.
* **Reserve Bank of India (RBI):**
* Impact: Responsible for conducting the auction and displaying the results.
* Action Required: Conduct the auction on December 28, 2018, process bids, and announce the results at its Mumbai office.
* **Government of India (GoI):**
* Impact: Manages its debt and raises funds through the sale/reissue of government stocks.
* Action Required: Monitor the auction process and utilize the funds raised.
Key Entities Referenced
Ministry of Finance: The Union Government ministry concerned with the finances of the country, including taxation, financial legislation, financial institutions, capital markets, and the Union Budget.
Department of Economic Affairs: A department within the Ministry of Finance responsible for advice on economic issues and preparation of the Union Budget.
Reserve Bank of India: India's central bank, responsible for issuing currency and regulating the banking system.
Mumbai Office, Fort, Mumbai: The specific branch office of the Reserve Bank of India located in Mumbai, Maharashtra, which is responsible for conducting the auction.
Government Stock: A security issued by the government to raise funds from the public.
7.37 GS 2023: Government Stock with coupon rate 7.37% maturing in 2023
7.17 GS 2028: Government Stock with coupon rate 7.17% maturing in 2028
8.24 GS 2033: Government Stock with coupon rate 8.24% maturing in 2033
Government of India
Ministry of Finance
Department of Economic Affairs
Budget Division
New Delhi, dated December 24, 2018
NOTIFICATION
Auction for Sale (Re-issue) of Government Stock (GS)
F.No.4(6)W&M/2018: 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)
7.37% GS 2023 Apr 16, 2018 05-00-00 Apr 16, 2023 Price Multiple 3,000
7.17% GS 2028 Jan 08, 2018 10-00-00 Jan 08, 2028 Price Multiple 4,000
8.24% GS 2033 Nov 10, 2014 19-00-00 Nov 10, 2033 Price Multiple 2,000
7.06% GS 2046 Oct 10, 2016 30-00-00 Oct 10, 2046 Price Multiple 3,000
Subject to the limit of `12000 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 December 28,
2018. Bids for the auction should be submitted in electronic format on the Reserve Bank of India Core Banking
Solution (E-Kuber) system on December 28, 2018. 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 December
28, 2018. The payment by successful bidders will be on December 31, 2018 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.
Date of Coupon
Name of the Coupon rate Date of Last Coupon Date upto which
payments
Security (%) payment accrued interest is due
(month / date)
7.37% GS 2023 7.37 Oct 16, 2018 Dec 30, 2018 Apr 16 and Oct 16
7.17% GS 2028 7.17 July 08, 2018 Dec 30, 2018 Jan 08 and July 08
8.24% GS 2033 8.24 Nov 10, 2018 Dec 30, 2018 May 10 And Nov 10
7.06% GS 2046 7.06 Oct 10, 2018 Dec 30, 2018 Apr 10 and Oct 10
By Order of the President of India
(Arvind Shrivastava)
Joint Secretary to the Government of India