Comments
The first municipal bond issued by Gujarat's civic body Vadodara Municipal Corporation Limited (VMC) was listed on the BSE on Wednesday.
Gujarat Chief Minister Bhupendra Patel performed the bell-ringing to mark the listing of the VMC Municipal bond-2022 on the BSE in Mumbai on Wednesday.
On March 24, Vadodara civic body, VMC raised ₹100 crore through municipal bond on private placement basis. The civic body successfully raised ₹100 crore which will be the contribution from the civic body for the Amrut Mission for urban development.
Related Stories
New learnings
RBI’s State finances report rightly focuses on municipal bodies and quality spendingThe BSE has a platform for Electronic Book Mechanism BSE BOND for issuance of debt securities on private placement basis.
Gujarat Chief Minister stated that Vadodara civic body has joined the two big cities — Ahmedabad and Surat — to raise funds using the global securities market platforms.
Overwhelming response
The ₹100-crore bonds issue was made open for subscription on March 24 but it had received overwhelming response from the investors as the bond issue was oversubscribed by 10.07 times of the issue size with total bids worth ₹1,007 crore from 33 interested investors.
Also, at the 7.15 per cent interest rate, the bonds issue is the cheapest fund raising by the civic body so far.
The proceeds raised from the bond issue will be used for water supply projects, and other civic projects. This will ease the water availability issues of the citizens.
"Prime Minister Narendra Modi has inspired to create a prudent financial management of local self government bodies by bringing together the civic bodies, urban development departments and the market regulator SEBI through the bonds issue," said Patel adding that urbanisation is no longer a challenge but has become an opportunity.
"Such bonds issue will strengthen the self-sufficiency for the civic bodies," the Chief Minister said.
Notably, India Ratings and Research has accorded A+/ Stable rating to the VMC Municipal Bond-2022. As the civic body has successfully raised the funds before March 31, 2022, it has qualified for the Government of India's incentive of Rs 13 crore.
.
Comments
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.