Overview of the Securities Conversion Auction

The Government of India has announced a conversion and switch auction of its securities amounting to an aggregate face value of ₹30,000 crore. Market participants holding eligible source securities maturing between 2027 and 2030 will have the opportunity to participate in this restructuring exercise through the Reserve Bank of India.

The auction mechanism allows investors to tender specific source securities in exchange for designated destination securities with longer maturity profiles. The central bank has structured the process to be handled entirely via electronic platforms.

Bidding Schedule and Operational Guidelines

Market participants must submit their bids electronically through the Reserve Bank of India Core Banking Solution, known as the e-Kuber platform. The bidding window is scheduled for August 17, 2026, between 10:30 AM and 11:30 AM. Results will be announced on the same day, with financial and security settlement slated for August 18, 2026.

Participants must adhere to specific procedural parameters when placing their orders on the portal:

• Bids must specify the face value amount of the source security alongside the quoted prices of both source and destination securities, expressed up to two decimal places.
• The minimum bid size is set at ₹10,000, with additional bids permitted in multiples of ₹10,000.
• The quoted price for any source security must strictly match the FBIL closing price recorded on the previous working day.
• Aggregate bids submitted by any participant cannot exceed their existing holdings or the notified amount for that specific source security.

Auction Structure and Settlement Process

The auction will follow a multiple-price based format, wherein successful bidders have their offers accepted at their respective quoted rates. Cut-off levels will be determined based on the pricing of the destination securities, with pro-rata allotments applied if multiple bids match the cut-off threshold.

While the conversion is designed to remain broadly cash neutral, fund settlements will account for net accrued interest variations between the source and destination securities. Additionally, cash considerations will apply to any odd face value amounts resulting from rounding off the destination securities during issuance. The government retains the authority to accept or reject any offer partially or wholly without providing explicit reasons.

Primary source: This independent news summary is based on official information from Reserve Bank of India. Read the original document for complete details.