NSE to auction investment limits for Rs 684 cr for govt bonds

Auction will be conducted on NSE's e-bid platform after the stock market hours on September 21

Leading bourse National Stock Exchange (NSE) will on Monday auction investment limits for foreign investors to buy government debt securities worth Rs 684 crore.

The auction will be conducted on NSE's e-bid platform from 1530 hours to 1730 hours, after the close of stock market hours on September 21, the exchange said in a circular.

The debt auction quota gives overseas investors the right to invest in the debt up to the limit purchased.

Depository data showed that total investments, including limits acquired by foreign investors through the auction route, stood at Rs 1,23,784 crore till September 16, which is 99.45 per cent of the total permitted investment limit of Rs 1,24,432 crore in government debt securities.

Consequently, exchange has decided to conduct an auction for the allocation of unutilised debt limits.

A mock bidding session would be conducted tomorrow to check the system performance, NSE said.

During earlier auctions, government bonds have always been subscribed multiple times, given the huge interest among foreign investors, while the demand for corporate bonds remains less.

Last month, BSE had conducted an auction for government bonds worth Rs 561 crore, which attracted bids worth Rs 987 crore.

Foreign investors are allowed to invest up to USD 25 billion (Rs 1,24,432 crore) in government debt securities through auction while an investment of up to USD 5 billion (Rs 29,137 crore) is permitted 'on tap'.

Further, the Reserve Bank of India (RBI) is in talks with the government to reset FII limit in government bonds in rupee terms.