Ghaziabad municipal bonds oversubscribed four times
Ghaziabad: The Ghaziabad municipal corporation on Wednesday successfully concluded its municipal bond issue and raised ₹150 crore, officials of the civic body said. The ‘green’ bonds were oversubscribed more than four times with 40 bids totalling ₹401 crore, the officials said, adding that the amount will be used for the construction of a tertiary sewage treatment plant.
Green bonds are the bonds issued by any sovereign entity, inter-governmental groups and corporates with an aim to utilize the proceeds of the bonds for projects classified as environmentally sustainable. The officials said that the corporation issued bonds of ₹150 crore which included base issue of ₹100 crore and green issue of ₹50 crore.
“The issue on Wednesday was oversubscribed more than four times. The listing will take place on the Bombay Stock Exchange on April 8. The corporation has proposed to take up a project for setting up a tertiary sewage treatment plant to further treat secondary treated sewage water. This water will be supplied further to industrial units and will help reduce pressure on groundwater resources in the city,” said MS Tanwar, municipal commissioner.
The officials said that the project is of a revenue generating nature and is expected to yield revenues after 30 months. They said that the total estimated cost of the project is about ₹239.93 crore, of which ₹150 crore will be funded through the bonds while the rest will be funded from the resources of the corporation.
In December 2020, UP chief minister Yogi Adityanath had visited the BSE in Mumbai on the occasion when the bond of the Lucknow municipal corporation got listed.
In July 2019, the UP cabinet approved the proposal of floating bonds by the municipal corporations of Lucknow and Ghaziabad to fund their infrastructure projects.
During the approval, bonds totalling ₹350 crore, including ₹200 crore for Lucknow and ₹150 crore for Ghaziabad, were proposed to be floated after a process.
“The Ghaziabad Nagar Nigam is the second municipal corporation to raise funds in the state of Uttar Pradesh. BSE firmly believes that Indian bond market is poised for a substantial growth and wide participation from non-institutional investors in this issue shows that India can use its domestic savings to fund its infrastructure needs in a substantial manner,” Ashishkumar Chauhan, managing director and chief executive officer of BSE, said in a statement.