RBI’s Long-Bond Green Push Finds Solid Demand, But Bids See Heavy Pruning

India’s bond market saw an action-packed auction session as the RBI completed sales across four key maturities: 2028, 2032, 2054 sovereign green bonds and 2055 conventional paper. The central bank accepted bids well below the total demand in every line, indicating it was willing to sacrifice volume rather than concede on pricing, especially at the ultra-long end.

 

At the flagship 2054 sovereign green bond auction, the RBI accepted a single bid for about ₹49.97 billion, granting it a 99.94% partial allotment and leaving the bulk of the 61 bids unfilled. The 2055 bond saw three bids partially allotted at 92.23%, with 91 bids worth roughly ₹697.1 billion accepted out of a much larger demand pool. In the 2032 segment, 21 bids were allotted 86.48% of their demand, while 61 bids were accepted for around ₹1.10 trillion, again only a slice of total bids. The 2028 bond had the tightest spigot: just two bids saw a 30.95% partial allotment and 13 bids were accepted for roughly ₹89.9 billion, compared with bids exceeding ₹277 billion.

 

Key highlights

Patterns point to strong demand but tight pricing discipline from RBI, particularly for long-dated and green securities, reinforcing the curve while nurturing India’s sovereign green segment.

 

Sources: RBI auction result notifications and syndicated market reports.