Rajkot Municipal Corporation Raises ₹100 Cr Through Bond Issue

Rajkot Municipal Corporation (RMC) successfully raised ₹100 crore via municipal bonds, oversubscribed by 4.95 times with a 7.90% interest rate and a five-year tenure. Rated AA by Crisil, the bonds were auctioned on the NSE's Electronic Bidding Platform.

RMC prepared extensively for this issue by implementing financial reforms, including a shift to double-entry accounting and digitizing transactions. The corporation's credit rating improved from A- to AA, driven by enhanced governance, tax recovery, and service benchmarking. RMC aims to achieve an AA+ rating, comparable to cities like Ahmedabad and Pune.

Proceeds will fund water and sewerage infrastructure for newly merged city areas, including a 23 MLD STP, a 14 MLD ESR, and a 500 km network. With a ₹13 crore interest subsidy from the Government of India, RMC’s borrowing costs are minimized. Bond issuance will also enhance financial transparency, internal controls, and reporting, elevating accountability within RMC.