Green bonds, so called because proceeds from those are supposed to be used to fund "green" projects that help reduce the country's carbon footprint, were opened up to civic bodies in November 2022 by the country's markets regulator. India's Indore Municipal Corporation will use the issue to fund a solar power plant in the state of Madhya Pradesh, according to a term sheet issued late on Wednesday.
The issue will open for subscription on Feb. 10 and will close on Feb. 14, according to the term sheet. It also has a greenshoe option to retain oversubscription of up to 1.22 billion rupees.
The civic body, which oversees development in the city of Indore, will use funds through separately transferable redeemable principal parts bonds, maturing in three years, five years, seven years and nine years and will offer a coupon of 8.25%, payable semi-annually.
The bonds are rated AA+ by India Ratings and AA by CARE Ratings.
On Wednesday, the Indian government said it will provide
incentives to urban civic bodies to improve their finances and
credit worthiness and help them raise funds through municipal
bonds.
($1 = 81.7670 Indian rupees)
(Reporting by Bhakti Tambe; Editing by Nivedita Bhattacharjee)
