The Government of Pakistan has significantly increased the reopening target for its 10-year variable rental rate Government of Pakistan (GoP) Hybrid Sukuk from Rs50 billion to Rs200 billion, reflecting growing emphasis on Shariah-compliant financing and long-term domestic borrowing.
According to a notice issued by the Pakistan Stock Exchange (PSX) following guidance from the Debt Management Office (DMO), the revised target applies to the reopening auction scheduled for June 10, 2026. Apart from the increase in the auction size, all other terms and conditions remain unchanged. The PSX also updated the maximum non-competitive bidding limit per investor within its auction system.
The 10-year variable rental rate Hybrid Sukuk was initially launched on April 16, 2026, and is set to mature on April 16, 2036. The instrument operates under a hybrid Islamic financing structure combining two Shariah-compliant mechanisms: Ijarah (sale-and-lease-back) and Commodity Murabaha transactions. Under the structure, 55 percent of the funds raised are allocated to the Ijarah component, while the remaining 45 percent are directed toward Commodity Murabaha.
The Sukuk offers a floating rental return linked to either the weighted average yield of six-month Treasury Bills or the six-month Pakistan Revaluation (PKRV) rate. For the first rental period, the benchmark has been fixed at 11.3685%, with investors receiving an additional spread of 35 basis points. Rental payments are distributed every six months, with profit rates reset at the beginning of each six-month cycle.
In a separate development, the PSX also released a revised auction calendar covering GoP Hybrid Sukuk and GoP Ijarah Sukuk issuances from June to August 2026. The updated schedule sets an ambitious cumulative target of Rs1.6 trillion through discounted and variable-rate hybrid Sukuk auctions across six offerings.
Additionally, fixed-rate hybrid Sukuk and fixed-rate zero-coupon Ijarah Sukuk auctions will collectively target Rs450 billion through three separate auctions. Variable rental rate auctions are planned throughout June, July, and August, indicating the government’s strategy to expand Islamic financing avenues and diversify its funding sources.
Financial analysts believe the expanded reopening target demonstrates the government’s confidence in investor appetite for Shariah-compliant investment products while strengthening Pakistan’s sovereign Sukuk market. The listed Sukuk carries 100% Statutory Liquidity Requirement (SLR) eligibility and is accessible to individuals, institutions, Roshan Digital Account holders, overseas Pakistanis, and foreign investors under the revised Government of Pakistan Sukuk Rules.
Meanwhile, the Pakistani rupee recorded a slight improvement against the US dollar, closing at Rs278.37 in the inter-bank market. Gold prices also increased in domestic markets, mirroring gains in international bullion rates amid ongoing geopolitical uncertainty.
