Hyderabad: The Greater Hyderabad Municipal Corporation (GHMC) has successfully raised Rs. 200 crores through Municipal Bond issuance.
The GHMC received bids of over than 2 times of the bond issue size of Rs. 200 crore. Bonds were placed at coupon rate of 8.90%.
The unsecured bond issue is backed by structure payment mechanism. Under the structured payment mechanism property tax and Fees & User charges collected by and due to GHMC will be deposited every month in a separate no-lien escrow account for debt servicing of bonds.
The issue has received response from wide range of investor categories such as insurance, pension funds, primary dealers, banks etc., This is the second successful Municipal Bond issuance after the Pune Municipal Corporation raised funds in the month of June, 2017.
Funds raised through the bonds shall be utilized to meet funding requirement of Strategic Road Development Plan (SRDP).
The Strategic Road Development Program is part of a larger plan of GHMC where it proposes to provide skyways, conflict free corridors and improve travel time within city without traffic jams.
As per Economic Survey 2016-2017, GHMC is Ranked 2nd amongst all ULBs in transparency accountability. GHMC has a consistent revenue surplus over the years and the Corporation is sell reliant entity with nearly 93% of its revenue coming from its own sources.
581 Capital Markets Limited acted as Sole arranger to this transaction. Incidentally, SW Capital Market was also the sole arranger to bond issue of Pune Municipal Corporation. (INN)