Pricing sustainability: A matched-pair analysis of green versus conventional corporate bonds in India
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2026
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| _version_ | 1866902032275734528 |
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| author | Dr. Kesavulu Poola Keshav Maheswari Atul Kumar Agrawal Moksh Agrawal |
| author_facet | Dr. Kesavulu Poola Keshav Maheswari Atul Kumar Agrawal Moksh Agrawal |
| contents | <p>As the green finance market has experienced a massive growth in a short period of time, an important question has arisen to issuers and investors alike: do green bonds convey a tangible cost of debt advantage over conventional bonds? Empirical research from developed markets suggests the existence of a "Greenium" but the evidence from emerging economies is not conclusive and is methodologically limited. This research, therefore, examines whether sustainability attributes are priced into the Indian corporate bond market by using a matched pair research design. Using a sample of fifteen matched pairs of green and conventional corporate bonds that have been issued between twenty twenty-two and twenty twenty-five, the analysis controls for issuer identity, credit rating, maturity, and currency denomination. Yield-to-maturity differentials are analysed across different categories of public-sector undertakings, private corporates, non-banking financial companies and banks, thus segregating the pricing effect of the green label. The results show a uniform yield discount for green bonds for all the matched pairs with Greenium values ranging from small discounts with highly rated public sector and banking issuers to large discounts of over 150 basis points for private sector and infrastructure-focused issuers. These results suggest that green bonds also serve as an instrument of sustainability rather than being used inefficiently in terms of finance and banking, especially in segments with higher perceived credit risk. The study hence discusses timely evidence of enhanced integration of sustainability considerations into debt pricing in India with important implications for corporate financing strategies and development of sustainable capital markets in emerging economies.</p> |
| format | Recurso digital |
| id | zenodo_https___doi_org_10_5281_zenodo_19107851 |
| institution | Zenodo |
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| publishDate | 2026 |
| publisher | Zenodo |
| record_format | zenodo |
| spellingShingle | Pricing sustainability: A matched-pair analysis of green versus conventional corporate bonds in India Dr. Kesavulu Poola Keshav Maheswari Atul Kumar Agrawal Moksh Agrawal Green Bonds Greenium Cost of Debt Sustainable Finance Corporate Bonds Emerging Markets <p>As the green finance market has experienced a massive growth in a short period of time, an important question has arisen to issuers and investors alike: do green bonds convey a tangible cost of debt advantage over conventional bonds? Empirical research from developed markets suggests the existence of a "Greenium" but the evidence from emerging economies is not conclusive and is methodologically limited. This research, therefore, examines whether sustainability attributes are priced into the Indian corporate bond market by using a matched pair research design. Using a sample of fifteen matched pairs of green and conventional corporate bonds that have been issued between twenty twenty-two and twenty twenty-five, the analysis controls for issuer identity, credit rating, maturity, and currency denomination. Yield-to-maturity differentials are analysed across different categories of public-sector undertakings, private corporates, non-banking financial companies and banks, thus segregating the pricing effect of the green label. The results show a uniform yield discount for green bonds for all the matched pairs with Greenium values ranging from small discounts with highly rated public sector and banking issuers to large discounts of over 150 basis points for private sector and infrastructure-focused issuers. These results suggest that green bonds also serve as an instrument of sustainability rather than being used inefficiently in terms of finance and banking, especially in segments with higher perceived credit risk. The study hence discusses timely evidence of enhanced integration of sustainability considerations into debt pricing in India with important implications for corporate financing strategies and development of sustainable capital markets in emerging economies.</p> |
| title | Pricing sustainability: A matched-pair analysis of green versus conventional corporate bonds in India |
| topic | Green Bonds Greenium Cost of Debt Sustainable Finance Corporate Bonds Emerging Markets |
| url | https://doi.org/10.5281/zenodo.19107851 |