The government successfully raised nearly Rs171 billion through the latest GoP Hybrid Sukuk auction, significantly exceeding its combined target of Rs125 billion as investors showed strong interest in both short-term and long-term Islamic investment instruments.
According to auction results released through the Pakistan Stock Exchange (PSX) system, the government collected a total of Rs170.976 billion in face value through fixed-rate discounted Sukuk and a variable rental rate Sukuk.
The strong response underlined investors’ continued confidence in government-backed Shariah-compliant investment products despite changing market conditions and fluctuations in profit rates.
The latest auction included fresh issues of fixed-rate discounted Government of Pakistan Hybrid Sukuk (GHS-FRD) and the first reopening of a 10-year variable rental rate Sukuk (GHS-VRR).
The amount raised was substantially higher than the original target, reflecting increasing demand for Islamic financial products in Pakistan’s capital market.
Fixed-Rate Sukuk Attract Strong Investor Interest
The GoP Hybrid Sukuk auction began with the offering of fresh issues of three-month, six-month and one-year fixed-rate discounted instruments.
Authorities had initially set a target of Rs75 billion for these short-term securities. However, investors submitted bids worth Rs344.91 billion, highlighting the strong appetite for government-backed Islamic instruments.
The government eventually accepted Rs108.23 billion through both competitive and non-competitive bids.
The one-year tenor attracted the largest share of investment, accounting for Rs58.31 billion of the total accepted amount.
Meanwhile, the three-month instrument raised Rs28.78 billion, while the six-month tenor generated Rs21.14 billion.
Competitive Bids For Fixed-Rate Sukuk
| Tenor | Accepted Amount | Yield |
|---|---|---|
| Three months | Rs27.45bn | 11.4353% |
| Six months | Rs20.34bn | 11.6899% |
| One year | Rs57.44bn | 11.84% |
| Total | Rs105.23bn | — |
Officials also accepted non-competitive bids amounting to Rs2.998 billion across all three tenors.
One-Year Sukuk Emerges As The Most Popular Option
The one-year Sukuk remained the preferred investment choice among institutional investors.
The government accepted Rs57.44 billion in competitive bids at a cut-off yield of 11.84%. Additional non-competitive bids worth Rs871 million increased the total amount raised through this instrument to Rs58.31 billion.
The three-month Sukuk recorded a cut-off yield of 11.4353%, while the six-month instrument settled at 11.6899%.
Analysts believe the strong response reflects investor confidence in the country’s Islamic finance sector as well as expectations regarding future movements in profit rates.
Ten-Year Variable Sukuk Also Records Strong Demand
Alongside the fixed-rate offerings, the government also conducted the first reopening of the 10-year variable rental rate Sukuk, which was initially issued on July 23, 2026.
The long-term security carried a reference profit rate of 11.3904% for the first profit period.
Authorities had set a target of Rs50 billion for the offering, but investors submitted bids worth more than Rs412 billion.
The government ultimately accepted bids valued at Rs62.75 billion, surpassing the original target by more than Rs12 billion.
Results Of The 10-Year Variable-Rate Sukuk Auction
| Category | Amount |
|---|---|
| Total bids received | Rs412.02bn |
| Competitive bids accepted | Rs62.50bn |
| Non-competitive bids accepted | Rs250m |
| Total amount accepted | Rs62.75bn |
The cut-off yield for competitive bids was fixed at 11.5704%.
Islamic Finance Sector Continues To Expand
The successful GoP Hybrid Sukuk auction reflects the rapid growth of Islamic finance in Pakistan, where both institutional and retail investors are increasingly seeking Shariah-compliant investment opportunities.
Government-backed Sukuk instruments have become an important source of financing for the public sector while also offering investors relatively stable returns.
Financial experts believe the latest auction results demonstrate the depth and resilience of Pakistan’s Islamic capital market, particularly as investor demand remains strong across both short-term and long-term instruments.
The higher-than-expected level of participation also indicates growing confidence in government securities despite ongoing economic challenges.
As Pakistan continues to expand its Islamic financial sector, analysts expect Sukuk offerings to play an increasingly important role in raising funds and supporting long-term economic development.