Mumbai: Nashik Municipal Corporation is targeting to raise another Rs 200 crore from the municipal bonds route by February next year, a top official has said.Speaking with reporters at a listing event for the maiden fundraise of Rs 200 crore through the route, its municipal commissioner, Manisha Khatri, said the civic body is preparing to launch another issue.
The new issue will be a green bond issuance, which is a slight change from the first issue that was oversubscribed by 4 times, Khatri said.Proceeds of the new issue will be invested on the arrangements for Kumbh Mela to be held in latter part of 2027 and also to ensure round the clock water supply to the city, she said.A senior official said the civic body is also mulling the idea of a public issue, which will take the cost of borrowing higher, but will ensure a larger investor base.
Khatri said three institutions, including National Bank for Financing Infrastructure and Development subscribed to the maiden Rs 200 crore issue.The coupon rate for the first issue is 7.8 per cent, but Khatri said that the money is virtually interest-free if one were to look at the money the corporation stands to get from the government's incentive schemes.In the case of the first bond raise, the total interest outgo for the five-year bond comes at Rs 80 crore, whereas the corporation is getting incentives of over Rs 94 crore, she said.
A sum of Rs 26 crore will come as incentives under the AMRUT scheme floated by the Union Ministry of Housing and Urban Affairs, while the rest of the incentives through the Urban Challenge Fund, she explained.Nashik is the third civic body from the state to access the municipal bond markets, and Khatri said a host of other cities have the capacity to access funding through the upcoming route.
The NMC has a headroom of raising up to Rs 1,000 crore through the route, she said, pointing to a detailed assessment done on the basis the body's finances.Raising money from the route requires bodies to make a few tweaks in its book keeping, and also ensure that revenue collections through aspects like property taxes happens in a timely manner, she said.
Money raised from the maiden issue will be used for construction of pedestrian bridge of Ram Jhula, construction of a vending plaza near Kalaram Temple, construction of proposed command and control centre near Kapaleshwar Temple and sewer network improvement works for administrative zones of Panchavati, Satpur and Nashik West, an official statement said.Chief Minister Devendra Fadnavis was present at the listing ceremony held at the NSE on Tuesday.
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