Signalling robust demand for the government bonds, an auction of debt securities today attracted bids of staggering Rs 14,285 crore from foreign investors, almost double than securities put on offer.
The auction, which was held through BSE’s ebidXchange platform for allocation of Foreign Portfolio Investors (FPIs) investment limits in government debt securities worth Rs 7,396 crore (USD 1.11 billion), saw bids for Rs 14,285 crore (USD 2.16 billion) as per the bourse.
At the end of two-hour auction this evening, 26 bids were declared successful, as per the information available with BSE.
The debt auction quota gives overseas investors the right to invest in bonds, up to the limit purchased.
During earlier auctions, government bonds have always been subscribed multiple times, given the huge interest among the foreign investors, while the demand for corporate bonds remained subdued.
Earlier in October, Sebi announced enhancing the limit for investment by FPIs in the government securities in two tranches from October 12, 2015 and January 1, 2016.
The limit for overseas investors in securities was hiked to Rs 1,29,900 crore from October 12, and it will further be increased to Rs 1,35,400 crore from January 1, 2016.
Prior to the October limit, they were allowed to invest up to Rs 1,24,432 crore in government debt securities through auction.