Amaravati to come up on bonds

​Amaravati: In a heartening development for the Andhra Pradesh government, the Capital Region Development Authority (CRDA) on Tuesday raised Rs 2,000 crore by issuing Amaravati Bonds. Within one hour of the issue on the Electronic Bidding Platform (EBP) of the Bombay Stock Exchange (BSE), the issue received oversubscription by 1.53 times.

Titled ‘Amaravati Bond 2018’, this 10-year instrument is offered at a fixed interest rate of 10.32% per annum, paid quarterly, with a 5-year moratorium on principal payment, which is redeemed on yearly basis for next 5 years at 20% every year.

The issue is guaranteed by the Government of Andhra Pradesh and is rated by CRISIL, Brickwork and Auicte. M/s AK Capital Services officiated as the sole arranger.

Chief Minister N Chandrababu Naidu had asked the CRDA to explore ways to fund Amaravati project which came up with the issue of Amaravati bonds. Raising funds through bonds route is new for the state and the APCRDA. It offers flexibility to deploy funds to multiple works. These funds are vital to making swift progress in greenfield projects and realise the value potential of development works.

Land required for Amaravati is largely assembled from the Land Pooling Scheme. Over 33,000 acres land has been handed over by over 27,000 landowners, many of whom are farmers. As on date, projects worth over Rs 27000 crore are underway and projects worth Rs 11,000 crore have to be awarded.