The government has significantly increased the target size of its 10-year variable rental rate GoP hybrid Sukuk, raising it from Rs50 billion to Rs200 billion. The update was issued by the Pakistan Stock Exchange (PSX) following instructions from the Debt Management Office (DMO).
This revision relates to the Sukuk reopening planned for June 10, 2026. PSX confirmed that the auction term sheet and related documents have been updated, while all other auction rules remain unchanged. The limits for non-competitive bids in the system have also been adjusted.
The 10-year Sukuk was originally issued on April 16, 2026 and is set to mature in 2036. It will be reopened under a hybrid Islamic structure based on Ijarah and Commodity Murabaha, with 55 percent allocated to Ijarah and 45 percent to Murabaha.
Its return is tied to the six-month T-bill or PKRV benchmark. The instrument carries an initial profit rate of 11.3685 percent along with a spread of 35 basis points. Profit payments will be made every six months, with rates reset at each period.
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PSX has also released an updated auction calendar covering June to August 2026. It includes a total target of Rs1.6 trillion for variable-rate Sukuk and Rs450 billion for fixed-rate Sukuk across several planned auctions.
Market participants view the increased target as a sign of the government’s push to expand Shariah-compliant domestic borrowing and develop the Sukuk market further.
The schedule outlines multiple auctions over the three months, with two VRR Sukuk auctions each in June, July, and August at gradually increasing target amounts. Fixed-rate Sukuk auctions are also planned on specified dates during the same period.
Analysts and market observers say the expanded issuance plan reflects efforts to diversify funding sources while also improving liquidity in the local Islamic debt market.