Pakistan has raised Rs75.314 billion in face value through its latest auction of Government of Pakistan Hybrid Sukuk and Government of Pakistan Ijarah Sukuk conducted through the Pakistan Stock Exchange (PSX) Auction System. The amount raised was below the government’s combined pre-auction target of Rs100 billion, reflecting the outcome of demand across the different Sukuk instruments offered during the auction. The government had set a target of Rs75 billion for fresh issues of 3-year and 5-year Fixed Rental Rate Government Hybrid Sukuk, while another Rs25 billion target was assigned to a 10-year Fixed Rate Zero Coupon Government Ijarah Sukuk.
The Fixed Rental Rate Government Hybrid Sukuk auction attracted substantial participation from investors across both available tenors. The government received total face value bids of Rs233.097 billion, including Rs128.518 billion for the 3-year Sukuk and Rs104.580 billion for the 5-year instrument. The 3-year Sukuk carried a coupon rate of 12.00%, while the 5-year Sukuk carried a coupon rate of 12.25%. The strong level of bids allowed the government to meet and slightly exceed its Rs75 billion target for the Hybrid Sukuk portion of the auction when both competitive and non-competitive bids were taken into account.
Competitive bids accounted for Rs75.113 billion of the amount accepted through the Fixed Rental Rate Government Hybrid Sukuk. The 3-year tenor accounted for the larger share, with the government accepting Rs58.363 billion at a cut-off price of 98.2016 and a cut-off yield of 12.7400%. For the 5-year tenor, Rs16.750 billion was accepted at a cut-off price of 97.9069 and a cut-off yield of 12.8300%. The results indicate that the government accepted the majority of the competitive amount through the shorter 3-year maturity, while the 5-year instrument contributed the remaining accepted amount.
In addition to competitive bids, the government accepted Rs0.202 billion through non-competitive bids. Of this amount, Rs0.131 billion was accepted against the 3-year tenor, with a weighted average price of 98.2128 and a weighted average yield of 12.74%. The remaining Rs0.071 billion was accepted through the 5-year Sukuk at a weighted average price of 98.0712 and a weighted average yield of 12.78%. When the competitive and non-competitive allocations are combined, the total face value accepted through the Fixed Rental Rate Government Hybrid Sukuk reached Rs75.314 billion.
The overall acceptance consisted of Rs58.494 billion in the 3-year tenor and Rs16.821 billion in the 5-year tenor. This brought the total amount raised through the Hybrid Sukuk portion of the auction to Rs75.314 billion, effectively covering the government’s Rs75 billion target for these two instruments. The auction figures also show that investor participation was considerably stronger in the Hybrid Sukuk instruments than in the separate 10-year Ijarah Sukuk offered during the same exercise.
The government also conducted an auction for a fresh issue of the 10-year Fixed Rate Zero Coupon Government Ijarah Sukuk, which carries a maturity date of October 8, 2036. The instrument had a pre-auction target of Rs25 billion but attracted almost no investor participation. The auction received total face value bids of only Rs0.01 million at a price of 29.4588. Given the negligible participation, the government rejected all bids and raised no funds through the 10-year Fixed Rate Zero Coupon Ijarah Sukuk.
As a result, the combined amount raised across the Government Hybrid Sukuk and Government Ijarah Sukuk auction remained at Rs75.314 billion against the overall Rs100 billion pre-auction target. The outcome highlights a clear difference in investor demand between the shorter and medium-term Fixed Rental Rate Hybrid Sukuk and the long-term zero-coupon Ijarah instrument. While the Hybrid Sukuk attracted Rs233.097 billion in total bids and generated Rs75.314 billion in accepted face value, the 10-year Ijarah Sukuk received only Rs0.01 million in bids and recorded zero acceptance.
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