Pakistan's Sukuk Auction Raises Rs. 69.96 Billion, Falls Short of Rs. 250 Billion Target

The Government of Pakistan raised a combined Rs. 69.955 billion in face value through its latest Government of Pakistan Hybrid Sukuk (GHS) auction held on November 11 via the Pakistan Stock Exchange (PSX) Auction System, falling significantly short of the pre-auction target of Rs. 250 billion. The settlement was scheduled for November 12.

The auction included a fresh issuance of three-month, six-month, and one-year Fixed Rate Discounted Hybrid Sukuk, along with the second reopening of a 10-year Variable Rental Rate (VRR) Hybrid Sukuk originally issued on October 15, 2026.

For the fixed-rate discounted Sukuk, the government set a target of Rs. 150 billion. Bids worth Rs. 392.374 billion were received across the three tenors. The government accepted Rs. 51.601 billion in face value through competitive bids, generating a realized amount of Rs. 47.768 billion. The one-year tenor saw the largest acceptance at Rs. 27.795 billion with a cut-off yield of 12.4300 percent, followed by the three-month tenor at Rs. 19.606 billion (12.1390 percent) and the six-month tenor at Rs. 4.2 billion (12.2995 percent). An additional Rs. 7.287 billion was accepted through noncompetitive bids. The total face value for the fresh issuance reached Rs. 58.887 billion, with a realized amount of Rs. 54.626 billion.

Separately, for the 10-year VRR Sukuk reopening, the government had set a target of Rs. 100 billion. The reference rate and initial coupon rate were both set at 12.1179 percent based on the latest six-month Treasury bill weighted average yield. The instrument attracted bids worth Rs. 325.940 billion, with prices ranging from 96.9181 to 99.2600. However, the government accepted only Rs. 11.068 billion in face value, generating a realized amount of Rs. 10.963 billion before premiums and Rs. 11.066 billion after including premiums.

Of the accepted amount for the VRR Sukuk, Rs. 10 billion came through competitive bids at a cut-off price of 98.6000 and a cut-off yield of 12.3624 percent, carrying a spread of 0.2445 percentage points over the reference rate.

The low acceptance compared to the target suggests the government was unwilling to meet the higher yield demands of investors, as it continues to manage its debt costs amid fiscal constraints.