Rs 200 crore municipal bonds issue of the Lucknow Municipal Corporation (LMC) listed at Bombay Stock Exchange (BSE).
LMC launched maiden municipal bonds issue on 13th November, 2020 which has been listed today (02nd December 2020) and is tradeable on BSE. The total issue of Rs 100 crores (including green shoe option of up to Rs 100 crores) attracted considerable investor interest and received bids totalling to Rs 450 crores from 21 investors. It closed at a coupon rate of 8.5% for a ten-year bond.
With the bonds issue LMC will get Rs 26 crore to subsidise its interest burden. This upfront incentive amount equates to reducing interest burden by 2% on the municipal corporation.
Lucknow has become India’s 9th city to have raised municipal bonds, which has been incentivized by the Ministry of Housing and Urban Affairs, Government of India under the mission AMRUT (Atal Mission for Rejuvenation and Urban Transformation).