₹200 cr AMC green bonds listed on the Bombay Stock Exchange
The state’s first green bond was launched on the online bidding platform in the presence of municipal commissioner M Thennarasan
Updated: Feb 9th, 2024
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| Image: CMO Gujarat website |
Updated on Feb 9, at 4.47 p.m.
Amdavad Municipal Corporation’s (AMC) green bonds were listed on the Bombay Stock Exchange (BSE) by chief minister Bhupendra Patel in a ceremony on Feb 8. Ahmedabad mayor Pratibha Jain and deputy mayor Jatin Patel were present at the event.
Other dignitaries included principal secretary of urban development and urban housing department Ashwani Kumar, Ahmedabad municipal commissioner M Thennarasan, deputy commissioner of finance Arjav Shah, chief business officer at BSE Sameer Patil, and director and president of SBI Capital Market Rajay Kumar Sinha.
Updated on Feb 6, at 2.55 p.m.
To achieve their goals earmarked in budget 2024 of the city being ‘net zero’, the Amdavad Municipal Corporation (AMC) issued the first municipal green bonds in Gujarat and mustered ₹200 cr.
The initial minutes of online bidding for green bonds saw an oversubscription of 13.60% with ₹415 cr bid against ₹200 cr bonds.
The state’s first green bond was launched on the online bidding platform in the presence of municipal commissioner M Thennarasan on Feb 4.
These bonds with an AA+ credit rating received a huge response; by 12 p.m. on the day of launch, a subscription of ₹1,360 cr was received from 30 investors.
Gujarat State Fertilisers and Chemicals Limited (GSFC) emerged as the major bidder with ₹170 cr of contribution. The remaining ₹30 cr was contributed by the other four investors.
The coupon rate interest to be paid to investors by AMC was 7.9%. After getting ₹20 cr from the centre, the effective rate of interest on the green bond is 5.90% considering the incentives.
Notably, the merchant bankers of the bond issue have been SBI Caps and Tipsons Consultancy Pvt Ltd.
What are green bonds?
As the name itself suggests, bonds have to do something with the environment. Green bonds are a special type of investment where investors lend money to a company, government, or organisation for a specific project that’s environmentally friendly.
The organisation, in this case, the AMC, will use the money raised exclusively for their green projects.
But what does the investor get? In return, the issuer of the bond promises to pay back the money lent to them, plus interest, over a certain period of time.
