PSX to conduct three GOP Ijarah Sukuk auctions in 1Q of 2024

The Pakistan Stock Exchange (PSX) announced on Tuesday the auction calendar for the sale of GOP Ijarah Sukuk (GIS) for the first quarter of 2024.

The GIS are Islamic bonds backed by government-owned assets that offer a Shariah-compliant alternative to conventional treasury bills.

According to the PSX notice, the auctions will be held in accordance with the Auction Target Calendar from January 2024 to March 2024. The notice also follows up on a previous notice issued on December 7th, 2023.

The PSX will conduct three types of GIS auctions: Short Term (12 Months), Fixed Rate, and Floating Rate. 

[caption id="attachment_159981" align="aligncenter" width="531"] Source: PSX website[/caption]

The short-term auctions will have a target auction size of PKR 40 billion, PKR 30 billion, and PKR 30 billion respectively for January, February, and March.

The Fixed-rate auctions will have tenor-wise targets of three and five years, with a total target auction size of Rs 30 billion, and Rs 60 billion each.

The Floating Rate auctions will also have tenor-wise targets of three and five years, with a total target auction size of Rs 30 billion to Rs 60 billion each.

The auction will be held on January 23rd, February 20th, and March 19th respectively. However, the PSX notice states that all auction dates from February onwards are subject to availability of assets. The settlement dates for the auctions are January 25th, February 22nd, and March 21st respectively.

The GIS auctions are part of the government’s efforts to diversify its sources of financing and reduce its reliance on conventional debt instruments.

Earlier, the government raised Rs479 billion through the sale of one-year Ijarah Sukuk at the PSX on December 9, attracting 16 times more than the target amount of Rs30 billion.