HMDA raises Rs 3,278 cr in tranche-I bonds

Mumbai: The Hyderabad Metropolitan Development Authority (HMDA) has successfully mobilized Rs3,278.96 crore from its first tranche of bonds, out of a total planned issue of Rs4,999.87 crore (including green shoe option).

The bonds, offered at a coupon of 8.70% per annum payable quarterly, are structured over 20 years with a Structured Payment (STRPP) option spanning 4 to 20 years, across 17 sub-series (Series A to Q), giving investors flexibility in duration.

The issuance carries strong credit ratings—AA | CE (Stable) from India Ratings & Research and AA+ | CE (Stable) from Acuite Ratings & Research.

“These are senior, secured, rated, listed, redeemable, taxable non-convertible debentures (NCDs), backed by an unconditional and irrevocable guarantee from the Government of Telangana, ensuring timely servicing of interest and principal,” said Venkatakrishnan Srinivasan, Founder & Managing Partner, Rockfort Fincap.

HMDA has approval to raise up to Rs19,999.99 crore, in multiple tranches. The balance of the first tranche will be raised in subsequent rounds, aligned with funding requirements.

The net proceeds, after issue expenses, will primarily finance infrastructure projects in the road sector within the Hyderabad Metropolitan Region (HMR).

MV Hariharan, former treasury head at SBI, said: “The backing is solid, Government of Telangana and municipal usage for infrastructure, but the devil lies in implementation. Oversight, audits, and timely disclosures are often weak or opaque.”