Patna Municipal Corporation (PMC) on Tuesday made its debut on the National Stock Exchange (NSE) with the listing of its Rs 200-crore municipal bonds, becoming the first urban local body in Bihar to tap the capital market for infrastructure funding.
The listing ceremony was held in Patna in the presence of Bihar Chief Minister Samrat Chaudhary. The corporation had raised Rs 199.99 crore through its maiden municipal bond issuance on October 30, against a base issue size of Rs 100 crore. The issue attracted bids worth more than Rs 205 crore, indicating strong investor interest.
The bonds carry an annual coupon rate of 9.20% and have a tenure of 10 years.
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PMC plans to deploy the proceeds towards urban infrastructure development at 15 locations across Patna. The projects include organised vending zones, commercial complexes and other public facilities. The redevelopment of New Market near Patna Junction is among the key projects identified for funding.
Speaking at the event, Patna Mayor Sita Sahu said the successful issuance would strengthen the corporation's financial capacity and help accelerate infrastructure development.
"The development of any city is not merely about preparing plans. It also requires financial strength, vision and the determination to implement those plans on the ground," she said.
Sahu added that the fundraising exercise reflected growing investor confidence in the corporation and would support improvements in civic infrastructure and public amenities.
Krishnan Iyer, Senior Vice President at NSE, said he hoped Patna's successful bond issuance would encourage other municipal corporations to explore the capital markets as an alternative source of financing.
"I hope other municipal corporations will also be inspired by this initiative and approach the public markets to raise funds," Iyer told ANI on the sidelines of the event.
He also pointed to incentives introduced by the Union Finance Ministry under the AMRUT scheme to encourage urban local bodies to explore alternative financing options.
Iyer said municipal corporations could also consider instruments such as green bonds and blue bonds, depending on the nature of their infrastructure requirements. Blue bonds, for instance, could help finance waterway-related development projects.
He noted that institutional investors accounted for the bulk of subscriptions to PMC's issue, adding that greater retail participation could help deepen the market.
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Under the financing arrangement approved by the Bihar government, PMC will service its debt obligations through its internal revenue sources.
According to Securities and Exchange Board of India (SEBI) data, 31 municipal bond issuances raised Rs 4,540.34 crore between 2017 and September 2026. These issuances were undertaken by 22 municipal corporations across seven states, with Bihar becoming the eighth state to enter the municipal bond market under the regulatory framework.
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