Lotus Petal Foundation has raised ₹55.6 lakh through its first Zero Coupon Zero Principal (ZCZP) bond issuance on the BSE Social Stock Exchange. The funds will support education for 160 students in Gurugram, benefiting from new rules that allow such subscriptions to qualify as corporate social responsibility (CSR) spending. Participants should note these instruments offer no financial returns or principal repayment.
The Gurugram-based non-profit organization, Lotus Petal Foundation, has successfully raised ₹55.6 lakh through its inaugural Zero Coupon Zero Principal bond issuance on the BSE Social Stock Exchange. The fundraising process concluded on July 31, 2026, surpassing the organization's minimum subscription target of ₹50 lakh for the project.
Unlike traditional bonds issued by companies or the government, these ZCZP bonds are unique philanthropic instruments. The term "Zero Coupon Zero Principal" means that investors who purchase these bonds do not receive any interest payments (coupons), nor do they get their original money back (principal) at the end of the term. In practice, these instruments function as a structured method for making tax-exempt donations to social causes. The funds raised are legally earmarked for specific charitable purposes, in this case, covering educational expenses for 160 students in Classes 3 and 5 at the Lotus Petal Senior Secondary School in Dhunela, Gurugram.
A significant factor behind the success of this issuance was the regulatory change that allows these ZCZP subscriptions to count toward a company’s mandatory Corporate Social Responsibility (CSR) expenditure under the Companies Act. This change has made the Social Stock Exchange a more attractive route for companies looking to fulfill their CSR obligations in a transparent and auditable manner. Corporate entities played a major role in this issuance, with notable participation from GTPL Hathway Ltd, which contributed 26% of the total funds, and Eureka Securities, which also participated in the subscription.
Retail investors also showed interest, accounting for approximately 22% to 25% of the total funds mobilized. The process involved a mix of platform-based bidding on the BSE and manual contributions. While the platform helped standardize the process, the foundation noted that the short timeline for corporate entities to adjust their existing CSR plans was a constraint. Moving forward, the organization expects higher corporate engagement as companies become more familiar with using the Social Stock Exchange for their CSR budgets.
For those participating in such social instruments, it is important to understand the nature of the risk and return. Since ZCZP bonds are not tradable in secondary markets and offer no financial return, they are essentially donations rather than financial investments. The primary "return" for the donor is the social impact of the funded project. Investors and companies participating in future issues on the Social Stock Exchange should monitor the project's progress and the non-profit's compliance with the fund-transfer protocols set by the market regulator, SEBI. The foundation's ability to execute its educational program within the specified budget and timeline will remain the key monitorable for future donors.