Govt bonds oversubscribed; FPIs bid worth Rs 8,541-crore

New Delhi: Foreign investors continue to remain positive on the Indian government debt as a debt auction Monday attracted bids of Rs 8,541 crore (USD 1.3 billion) against securities worth Rs 6,096 crore put on offer.

The auction was held on NSE's e-bid platform for allocation of Foreign Portfolio Investors (FPIs) investment limits in government debt securities worth Rs 6,096 crore, as per the information available with the exchange.

The auction was conducted from 3.30 PM to 5.30 PM after the close of market hours. The auction received bids for Rs 8,541 crore. At the end of two-hour auction, 41 bids were declared successful.

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 auction route stood at Rs 1,30,719 crore till March 3, which was 96.54 percent of the total permitted investment limit of Rs 1,35,400 crore in government debt securities.

In earlier auctions, government bonds have been subscribed multiple times, given the huge interest among the foreign investors.

An auction of government debt securities conducted on March 28, had attracted bids worth Rs 6,810 crore from FPIs against Rs 5,035 crore put on offer.

Besides, FPIs will be able to invest an additional Rs 14,000 crore in various government securities, including those of the states, from today onwards.

The cap has been now raised to Rs 2,00,500 crore from the current Rs 1,86,500 crore.

The limits would be enhanced further by another Rs 13,500 crore from July 5 onwards.

This follows decisions by RBI and Sebi late last month to allow greater foreign fund flows into the government securities, which are generally favoured by FPIs over the corporate bonds in India.