REC Limited, a Maharatna company under the Ministry of Power, has achieved a significant milestone in India’s capital market by conducting the country’s first pilot issue of tokenized corporate bonds. The transaction was carried out under the Securities and Exchange Board of India (SEBI) Regulatory Sandbox Framework.
The pilot bond issue was valued at ₹500 crore, consisting of a base issue of ₹100 crore and a green shoe option of ₹400 crore. The bidding was conducted through the Electronic Bidding Platform (EBP) of the National Stock Exchange of India Limited (NSE).
The issue received a strong response from investors, with the total demand reaching ₹796 crore during book-building. This represented an oversubscription of nearly eight times the base issue. Following the bidding process, REC accepted ₹500 crore at an annual coupon rate of 7.30%. The bonds have a tenure of one year and nine months.
A key feature of the transaction was the use of tokenization and digital infrastructure to speed up the bond issuance and settlement process. Pay-in, allotment and listing were completed on the same day. The securities have been officially listed on both the NSE and BSE Limited.
The pilot involved coordinated efforts from several major financial market institutions, including SEBI, the Reserve Bank of India (RBI), the National Payments Corporation of India (NPCI), depositories and stock exchanges.
The transaction also introduced advanced features such as atomic Delivery-versus-Payment (DvP) settlement and shared-ledger transparency. Under this system, ownership of the securities is recorded and tracked on a permissioned distributed ledger. This approach is designed to reduce operational delays, settlement risks and other inefficiencies in the traditional securities settlement process.
The initiative is aligned with the broader “Demat 2.0” vision, which seeks to use distributed ledger technology and Central Bank Digital Currency (CBDC)-enabled settlement while maintaining existing regulatory safeguards.
Commenting on the development, Rajesh Kumar, Director (Finance), REC, highlighted SEBI’s role in promoting technology-driven reforms and improving market efficiency. He said the integration of digital infrastructure and tokenization under the Demat 2.0 framework could provide a foundation for the next generation of capital market infrastructure in India.
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