Rs 40,000 crore buyback announced by Government of India opening on May 9, 2024: Complete details inside!

The auction, set for May 9, 2024, from 10:30 AM to 11:30 AM, will employ the multiple price method. Investors must electronically submit offers via the Reserve Bank of India Core Banking Solution (E-Kuber) system.

The Government of India has unveiled plans for a significant buyback of its securities, amounting to a staggering Rs 40,000 crore (face value). This move aims to manage debt obligations and streamline financial operations.

Scheduled for May 09, 2024, between 10:30 AM and 11:30 AM, the auction will utilize the multiple price method. Investors are required to submit their offers electronically through the Reserve Bank of India Core Banking Solution (E-Kuber) system. The auction results will be disclosed on the same day, with settlement slated for May 10, 2024.

The securities listed for buyback encompass a range of maturity dates:

• 6.18% GS 2024: Maturity on November 4, 2024.
• 9.15% GS 2024: Maturity on November 14, 2024.
• 6.89% GS 2025: Maturity on January 16, 2025.

Government of India reserves the right to:

• Decide on the quantum of buyback of individual securities.
• Accept more or less than the notified amount of Rs 40,000 crore.
• Accept or reject any or all of the offers, either wholly or partially, without assigning any reason thereof.

Notably, there is no specified amount for individual securities within the overall Rs 40,000 crore cap. The Government reserves the prerogative to determine the quantum of buyback for each security. Additionally, it retains the discretion to accept more or less than the designated amount, as well as the authority to accept or reject offers, wholly or partially, without justifying.

This strategic step underscores the Government's commitment to effective debt management and financial stability. Investors and market participants will keenly await the outcome of the auction, which is poised to have significant implications for the financial landscape.

As India navigates evolving economic dynamics, such initiatives play a pivotal role in fostering confidence and facilitating prudent fiscal policies.