NHAI to issue green bonds to implement eco-friendly measures on Delhi-Mumbai Expressway project

New Delhi: The National Highways Authority of India (NHAI) on Thursday said its fully-owned Special Purpose Vehicle DME Development (DMEDL) will issue green bonds worth Rs 1,000 crore to implement eco-friendly measures on the Delhi-Mumbai Expressway project.

The size of the issue will be up to Rs 1,000 crore, with a base issue size of Rs 500 crore. There will be a green-shoe option up to Rs 500 crore in case of oversubscription, NHAI said in a statement.

The first of its kind green bond issue is expected to be launched in the second week of December. Funds raised through this issue will be used for avenue plantation, median plantation, construction of animal underpasses, natural storm water drainage, streetlight on renewable energy (solar), waste recycling & reuse and rainwater harvesting, said the statement.

"The green bonds will help to encourage investment in eco-friendly projects especially in Roads & Highways sector and will facilitate long-term cost savings by reducing energy consumption and lowering the impact of vehicular emission on the environment, " NHAI Chairman, Shri Santosh Kumar Yadav.

The issue will help in enhancing DMEDL financial performance in terms of the overall cost of borrowings and will diversify investor base by attracting ‘Environmental, Social, and Governance’ focused investors. DMEDL has appointed Care Edge analytics as the Third-Party Reviewer (TPR) who have identified and certified the Green Activities of DMEDL.

Incorporated in August 2020, ‘DME Development Ltd.’ is a wholly owned Special Purpose Vehicle (SPV) of NHAI for financing, construction, and operation of the Delhi-Mumbai Greenfield Expressway and has received AAA rating from CRISIL, CARE and India Rating. DMEDL aims to raise about Rs. 48,000 Crore from banks & financial market through loans & bonds and has successfully raised around Rs. 42,000 Crore till now for the implementation of Delhi – Mumbai Expressway project, the NHAI statement said.