Nashik Municipal Corporation to issue green bonds worth Rs 200 crore in Jan-Feb, says Commissioner Manisha Khatri

Nashik Municipal Corporation is likely to issue another tranche of bonds, which is expected to green bonds worth Rs 200 crore in January or February, said Commissioner Manisha Khatri told Moneycontrol. She added that the issuance of the bonds is expected to be public issue, which will allow retail participants to invest and gives a better pricing compared to private placement. The proceeds from this bond issue will be utilized for the water treatment plant in the Nashik, reducing water losses, and to ensure 24*7 water supply to the city, Khatri added. On December 1, Nashik Municipal Corporation listed its bonds on the National Stock Exchange of India (NSE). The bonds were issued on a private placement basis at a coupon rate of 7.80 percent. The issue witnessed a response from investors, receiving oversubscription of 3.95 times against the base issue size of Rs 100 crore, with total bids worth Rs 395 crore on NSE’s Electronic Bidding Platform. The corporation raised Rs 200 crore through "Clean Godavari Bonds 2030 Series-I" to fund key projects, including a sewerage pipeline network, Ram Kal Path Phase-II, the Ram Jhula pedestrian bridge, and vending zones near Kalaram and Kapaleshwar temples in the city. “These bonds will finance infrastructure development related to Kumbh Mela 2027, and also ensure sustainable development of the region. We managed to complete the entire fund-raising process within 4 months, and are also working on the second bond issue,” said Khatri said. A.K. Capital Services Ltd acted as the Transaction Advisor and Merchant Banker to the issue. The bonds carry an ‘AA+’ rating from CRISIL Ratings and India Ratings and have tenure of five years. Additionally, Nashik Municipal Corpration is set to receive an incentive of Rs 26 crore from the Government of India for issuing the municipal bonds, further strengthening its financial position and commitment to sustainable urban development. NMC may be eligible for a 25 percent UCF grant, amounting to Rs 68.75 crore. Thus, NMC may receive incentives totalling Rs 94.75 crore, which can be utilized for these projects as well as future developmental initiatives.