The bonds issued by the Capital Region Development Authority (CRDA) of Andhra Pradesh, for the construction of the new capital, Amaravati, got oversubscribed by 1.5 times on the electronic bidding platform of the BSE on Tuesday.
According to CRDA Commissioner Ch. Sridhar, the bonds for institutional investors were issued for Rs 1300 crores on the electronic bidding platform of the BSE and "within an hour we could get Rs 2,000 crores. We will take a decision on exercising the greenshoe option and retaining the oversubscribed amount of Rs 700 crores."
Expressing happiness over the response of the institutional investors, the commissioner said soon in roughly three months Amaravati bonds would be issued for retail investors also. "We are working out the modalities. The overwhelming response shows the faith the investors have reposed in the AP Government, the honourable Chief Minister and the way our Government is functioning."
He said the amount would be spent on infrastructure development in the capital region and for other works. He said the works in the capital region had picked up pace and the momentum would be maintained. "The capital construction requires roughly Rs 48,000 crores in the first phase and we are exploring various options of mobilising the funds," he added.
Special commissioner V. Ramamanohara Rao said that for the 10-year bond the State Government would have to pay only the interest amount to the investors for the five years and then the principal would also have to be paid. The cash outflow in the first five years would be less, he added.