Nashik Municipal Corporation's Rs 200 Crore Green Bonds Set for Stock Exchange Listing
The Nashik Municipal Corporation (NMC) is poised to make a significant financial move with its Rs 200 crore green bonds, which are scheduled to be listed on both the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE) this Wednesday. This strategic initiative aims to bolster the city's infrastructure in preparation for major upcoming events and long-term urban development.
Funding Water Treatment Expansion for Kumbh Mela and Beyond
The primary objective of these green bonds is to finance a substantial increase in Nashik's water treatment capacity. Specifically, the funds will be allocated to enhance the city's water treatment capabilities by an additional 274 million litres per day (MLD). This expansion is crucial to accommodate the anticipated surge in water demand during the forthcoming Simhastha Kumbh Mela, a major religious congregation, while also addressing the city's future drinking water requirements.
Municipal Commissioner Manisha Khatri, Mayor Himgauri Aher, and Deputy Mayor Vilas Shinde jointly announced these plans during a press conference held on Monday. They emphasized that the project is not only timely but essential for sustainable urban growth.
Financial Details and Investor Appeal
The green bonds will feature an attractive coupon rate of 8.05% per annum, with an effective yield of 8.2% per annum. This rate applies uniformly across all investor categories, including institutional, non-institutional, and retail individual investors, making it a broadly accessible investment opportunity.
This issuance follows the NMC's successful raising of Rs 200 crore through municipal bonds in November of last year, which were utilized for various infrastructure projects ahead of the Kumbh Mela. The current green bond offering represents a continued effort to secure necessary funding for critical civic improvements.
Incentives and Project Components
In addition to the bond proceeds, the NMC will receive incentives totaling Rs 26 crore from the Central Government for issuing these green bonds. Additional funds are expected through urban challenge funds, further supporting the financial viability of the project.
Commissioner Khatri detailed that the project encompasses several key components designed to optimize water distribution and reduce wastage. A new water distribution pipeline will be laid from Vilholi, located on the outskirts of Nashik, to Sadhugram in Tapovan. This infrastructure upgrade is projected to significantly decrease current water leakages from 45% to a more efficient 20%.
Addressing Current and Future Water Demands
Mayor Aher highlighted the importance of this initiative, stating that it marks a significant milestone for the civic body. The green bonds will directly support projects aimed at augmenting water treatment capacity in anticipation of the Kumbh Mela, ensuring adequate supply during the event.
The Water Treatment Plant (WTP) project, financed through these bonds, is specifically designed to meet an additional 250 MLD water requirement during the religious congregation. Key elements of the project include increasing the pumping station capacity at the Mukane dam, constructing a new water treatment plant at Vilholi, and laying new water distribution pipelines from the Vilholi WTP to Sadhugram and the Nilgiri water treatment plant in Nashik's Panchavati area.
Meeting Nashik's Growing Water Needs
Currently, Nashik city's daily water requirement exceeds 550 MLD. With the upcoming Kumbh Mela, this demand is expected to rise by an additional 240 MLD, underscoring the urgency of the water treatment expansion. The green bond-funded projects are strategically planned to not only cater to this temporary spike but also to fortify the city's water infrastructure for future growth and sustainability.
This comprehensive approach ensures that Nashik is well-prepared for both immediate challenges and long-term development, making the green bond issuance a pivotal step in the city's urban planning and environmental stewardship.
