Govt Targets to Raise Rs300bn Through GIS Auction via PSX in 2Q2024

The government is targeting to raise Rs300 billion during the next three months (March-May) of 2024, through the auction of GOP Ijara Sukuk (GIS) that will be conducted by the Pakistan Stock Exchange Limited (PSX).

The aim is to raise Rs60bn through the sale of 1-year Islamic Bonds during this quarter.

Additionally, the government targets to raise Rs120bn through the sale of 3-year and 5-year fixed-rate Islamic bonds.

Meanwhile, the Rs120bn will be collected through the sale of GIS-floating rate bonds with tenures of 3 and 5 years.

The auction calendar released by the local bourse reveals that two auctions will be conducted during March, one on March 14, and the second one is scheduled on March 28, 2024.

In this respective auction, the domestic equity market has a target to raise Rs100bn in total. 

According to the breakdown of the total amount, PSX plans to raise Rs20bn through GIS (short term), Rs40bn through GIS (Fixed Rate), and the remaining Rs40bn through the sale of GIS (floating rate).

Likewise, PSX will host two auctions in the month of April, one to be held on April 08 and the other one on April 25, with a cumulative target of Rs100bn through different tenures Islamic bonds.

Among this total, Rs20bn will be obtained through short-term GIS, while Rs40bn each will be raised through fixed and floating GIS.

Moving forward, March will also witness two auctions with a total target of Rs100bn.

The government plans to raise this amount by selling Rs20bn worth of short-term GIS, and 40bn each through fixed and floating GIS.

It is important to highlight that the local bourse conducted its inaugural auction for the sale of GIS on December 09, 2023, experiencing an overwhelmingly positive response with bids totaling Rs478.78bn.

However, despite an impressive response operational challenges hampered brokerage investors.