States raised Rs 16,900 crore through the Reserve Bank of India's auction of State Government Securities (SGS) held on April 21, according to the central bank.

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State-wise Fundraising Breakdown

The total notified amount for the auction was fully allotted across multiple states, including Andhra Pradesh, Maharashtra, Punjab, Rajasthan and Telangana. Andhra Pradesh raised a total of Rs 4,600 crore through three securities of varying tenors--8-year, 16-year and 30-year--while Maharashtra mobilised Rs 4,000 crore across three securities. Punjab raised Rs 1,300 crore, Rajasthan raised Rs 4,000 crore across multiple issuances, and Telangana raised Rs 3,000 crore through three securities.

Auction Yields and Pricing

The cut-off yields for the securities varied across states and tenors, reflecting market demand and maturity profiles. Andhra Pradesh's securities saw cut-off yields ranging between 7.63 per cent and 7.81 per cent, while Maharashtra's ranged between 7.55 per cent and 7.79 per cent. Punjab's 12-year security recorded a cut-off yield of 7.84 per cent, while Rajasthan's securities were priced between 7.64 per cent and 7.82 per cent. Telangana's securities saw cut-off yields in the range of 7.54 per cent to 7.82 per cent.

The weighted average yields across the securities were broadly in line with the cut-off yields, indicating stable demand conditions in the auction.

Purpose of SGS Auctions

The RBI conducts such auctions on behalf of state governments to enable them to raise funds from the market to meet their borrowing requirements.