L&T board approves fund raising up to Rs 9000 crore via various instruments

Engineering conglomerate Larsen & Toubro (L&T) on Thursday said the company’s board has approved fund raising plans for up to Rs 9,000 crore through various instruments, including non convertible debentures.

“The Board of Directors, at its meeting held today, has, inter alia, approved Long-term borrowing up to Rs9000 crore, either through external commercial borrowings, term loans, non-convertible debentures or any other instrument as may be appropriate,” the company said in its statement to BSE.

L&T did not disclose the purpose for fund raising. In the current financial year, L&T is the second conglomerate putting provisions in place for a fund-raising. Reliance Industries, last week, approved fund raising up to Rs 25,000 crore through NCDs.

L&T also announced major award wins in the power transmission and distribution business,  which includes sub-station works in Egypt and Kuwait and another grid station project in Oman. On the domestic side, the company also reported orders from discoms in Uttar Pradesh and a distribution network job in Chennai.

With it buy-back plan unexecuted so far and proceeds expected from the sale of its electrical business to Schneider Electric, the company is already healthy in terms of cash on hand. In May 2018, L&T agreed to sell the business to Schneider for Rs14000 crore.

In an interview with Business Standard in early March, SN Subrahmanyan, chief executive officer (CEO) and managing director for the company said,”We don't have any major capital program on hand, but in such times it is better to be careful with cash on hand and that is our thought process right now.”