On 4th February government of India repurchased Rs 166.49 billion of bonds.T otal bids were Rs 533.53 billion. 214 bids were received and 63 of them accepted. Government repurchased 7.59% April 2016 for Rs 81.85 billion at cut off price of Rs 100, 10.71% April 2016 for Rs 5.35 billion at cut off price of Rs 100.60, 7.02% August 2016 for Rs 79.29 billion at cut off price of Rs 99.88.
Repurchase of Bonds
The Government of India had announced repurchase of Rs 200 billion of bonds that are maturing in 2016. The repurchase will be through a price based auction on the 4th February 2016.
The government is running a cash surplus of around Rs 1300 billion that is parked with the RBI and in order to infuse liquidity into the market, it is repurchasing its own bonds by utilizing surplus cash balances. Liquidity is expected to tighten in March 2016 as advance tax payments go out of the system. Government will repurchase 7.59% April 2016, 10.71% April 2016, 7.02% August 2016.