GHMC raises Rs.200 crore through bonds

Thu 15 Feb 2018, 12:16:18
The Greater Hyderabad Municipal Corporation (GHMC) raised Rs.200 crore through municipal bonds on Wednesday. The GHMC received 200% subscription and bonds were placed at coupon rate of 8.90%. The GHMC is the second municipal corporation after the Pune Municipal Corporation to float municipal bonds in the recent past.

GHMC commissioner B Janardhan Reddy said the funds raised through bonds would be utilised for the government’s ambitious Strategic Road Develop Plan (SRDP), taken up for construction of multi-layer flyovers across the city to ease traffic problems.

Both Janardhan Reddy and Mayor Bonthu Rammohan went to Mumbai to oversee the bond bids.

The municipal corporation has been mulling floating municipal bonds and

also raising loans for various projects for the past one year. A few months ago the state government gave the GHMC the go-ahead. Before floating the bonds, the GHMC undertook the process of securing credit rating from reputed agencies as evidence of its financial robustness.

The GHMC’s financial strength was examined by CARE and India Ratings and rated as AA (stable). This rating is an improvement from the rating issued by CARE last year which stood as AA negative.“Rs.1,000 crore would be raised from the bond market out of which electronic bidding for the first tranche of Rs.200 crore was done on Wednesday. 

The issue evoked overwhelming response and received 200% subscription,” the GHMC commissioner said.

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