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With the issuance of bonds, the GHMC became the second local body, after its counterpart in Pune, to raise funds through this route in the current financial year.
The Pune Municipal Corporation had raised Rs 2 billion in June last year.
The issue was oversubscribed two times its size. The coupon for the bonds was fixed at 8.90 per cent. It was subscribed by insurance, pension funds, primary dealers, banks, etc.
The funds raised will be used for road development in the city.
"The unsecured bond issue is backed by structure payment mechanism. Under the structured payment mechanism, property tax and fees, and user charges collected by and due to GHMC will be deposited every month in a separate no-lien escrow account for debt servicing of bonds," SBI Capital Markets said.
The GHMC, rated AA by CARE and India Ratings, has a consistent revenue surplus over the years. The corporation is a self-reliant entity, with nearly 93 per cent of its revenue coming from its own sources, SBI Capital Markets said.