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Patna to raise Rs 200 crore via municipal bonds

By · Published by Everything Blog

In short

The planned ₹200 crore issuance by Patna Municipal Corporation will be priced at an estimated 150 to 175 basis points above the 10-year benchmark yield, which recently climbed to 7.44%. Arranged in part by AK Capital, the fully presold offering represents the first municipal bond issuance in India since Nashik entered the market in early March 2026. While the Brihanmumbai Municipal Corporation postponed its own record-sized offering due to rising yields, Kanpur Nagar Nigam is advancing plans to raise ₹125 crore in the near term.

Key points

  • Institutional lenders HUDCO and NaBFID provided early commitments to completely presell t…: Institutional lenders HUDCO and NaBFID provided early commitments to completely presell the bond offering.
  • Higher borrowing yields prompted Mumbai's municipal corporation to stay on the sidelines…: Higher borrowing yields prompted Mumbai's municipal corporation to stay on the sidelines despite planning a record issue.
  • Kanpur Nagar Nigam is preparing a ₹125 crore debt raise after CareEdge Ratings reaffirmed…: Kanpur Nagar Nigam is preparing a ₹125 crore debt raise after CareEdge Ratings reaffirmed its credit ratings.

Sources checked by our analysis pipeline: 1

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ET had reported in its July 3 edition that Patna would tap the bond market.

Kanpur municipality, too, is expected to raise ₹125 crore in the coming months. Kanpur Nagar Nigam got its ratings reaffirmed on Tuesday by CareEdge Ratings.

The Patna Municipal Corporation is set to launch ₹200 crore worth of municipal bonds, with bids opening on October 30. This move marks Bihar's inaugural bond issuance, sparking renewed enthusiasm for municipal bonds. Meanwhile, Kanpur Nagar Nigam is also gearing up to issue ₹125 crore soon. Early interest from investors like HUDCO and NaBFID indicates a growing momentum in the bond market, supported by governmental efforts to boost urban financing.

The last municipal bond issuance was by Nashik in early March 2026. The Brihanmumbai Municipal Corporation (BMC), which was expected to launch India's biggest municipal bond issue this year, has stayed on the sidelines, likely due to higher yields.

The 10-year yield has increased to 7.44% on Wednesday from 6.90% a month ago. However, Patna Municipal's ₹200 crore issue has already been presold,…

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