First Tranche Of Sovereign Green Bonds Sold At A Thin 'Greenium'
The auction places the green premium, or greenium, for India's sovereign green bonds between 5 to 6 basis points.
India's maiden sovereign green bond auction, for Rs 8,000 crore worth of bonds, concluded with a thin green discount on the securities.
The auction for the 10-year and 5-year maturity bonds, worth Rs 4,000 crore each, closed at yields of 7.1% and 7.29%, respectively, according to a statement from the Reserve Bank of India. Indian government bonds with the same maturity period were trading at a yield of 7.16% and 7.35%, respectively, as of the cut-off time.
The auction places the green premium, or 'greenium', for India's sovereign green bonds at 5-6 basis points. The pricing difference is called a premium because it allows the issuer to raise money at a cheaper rate.
The proceeds will be deployed in public sector projects, which help in reducing the carbon intensity of the economy, the RBI had said on Jan. 6.
This is the first tranche of India's sovereign green bond auction. The next auction, also for Rs 8,000 crore worth of sovereign green bonds, is scheduled to be conducted on Feb. 9.