Pune : PCMC raises Rs 200 crores for rejuvenation of Mula river through municipal bonds
Pimpri Chinchwad Municipal Corporation becomes the first municipal corporation to raise municipal bonds in the current financial year.
By: Pune Pulse
July 29, 2023
Pune: In its maiden attempt, the Pimpri Chinchwad Municipal Corporation (PCMC) has successfully raised Rs 200 crores by floating municipal bonds which will be utilized for the rejuvenation work of Mula River from Wakad Bypass to Sangvi Bridge under the Pune River Rejuvenation Project.
It is worthy to note that a municipal bond is a debt instrument issued by a municipal corporation under municipal laws with the permission of the respective state government.
Speaking to Pune Pulse, Jeetendra Kolambe, Chief Account & Finance Officer, PCMC, said, ” The successful issuance of the Rs 200 crore municipal bond demonstrates PCMC’s financial strength and opens up new options for financing important projects that will improve the lives of its residents.”Â
As per information, Shekhar Singh, Municipal Commissioner, PCMC stated that investors submitted bids totalling Rs 315 crore for the rejuvenation of the Mula River.
The subscription amount of Rs 200 crore will be accepted by the PCMC at an 8.15 per cent coupon. For issuing its first municipal bond, PCMC will be eligible for an incentive from the Union Government worth Rs 26 crore.
Also, PCMC has become the first municipal corporation in the entire country to issue a municipal bond in the current financial year. The last municipal bond issued was by Indore Municipal Corporation in the last monetary year in February 2023 which gave bonds at a coupon of 8.25 percent via public issue.
PCMC will stand out in the national and international capital markets as a result of this bond floating, improve internal compliance, and introduce a new source of funding.
Notably, PCMC has received a rating of Crisil AA+/Stable from Crisil and Care AA+/Stable from CARE Ratings.
