Patna Municipal Corporation Lists Bihar’s First Municipal Bond on NSE

Patna Municipal Corporation (PMC) has listed Bihar’s first municipal bond on the National Stock Exchange (NSE), raising ₹199.99 crore for urban infrastructure in Patna.

Bond issue and use of proceeds

The funds will finance 15 projects to redevelop market areas and improve civic services across the city. The issue comprised a base size of ₹100.03 crore and a greenshoe option of ₹99.96 crore. Investor interest was nearly twice the base issue size.

The bonds carry a 9.20 per cent coupon rate and have an AA (Stable) credit rating.

Important Facts for Exams

• Municipal bond structures: Municipal bonds are commonly classified as general-obligation debt, supported by broad municipal revenues, or revenue bonds, serviced from specified project revenues.
• Greenshoe mechanism: A greenshoe is an over-allotment facility that lets an issuer allot additional securities beyond the initial offer, subject to the disclosed option limit.
• Indian issuance framework: In India, municipal debt securities issuance and listing fall under SEBI’s 2015 regulations, which prescribe disclosure and investor-protection requirements.
• Rating outlook: A Stable outlook indicates an agency expects the assigned rating to remain broadly unchanged over its outlook horizon; it does not mean default risk is absent.