LARSEN & TOUBRO LIMITED - Bombay Stock Exchange NCD I… · LARSEN & TOUBRO LIMITED (“L&T” or...

PRIVATE & CONFIDENTIAL

LLAARRSSEENN && TTOOUUBBRROO LLIIMMIITTEEDD

(An existing company under the Companies Act, 1956) Registered Office: L&T House, N.M.Marg, Ballard Estate, Mumbai 400001.

Website: www.larsentoubro.com

DDIISSCCLLOOSSUURREE DDOOCCUUMMEENNTT FFOORR PPRRIIVVAATTEE PPLLAACCEEMMEENNTT OOFF PPAARRTTLLYY PPAAIIDD UUNNSSEECCUURREEDD

RREEDDEEEEMMAABBLLEE RRAATTEEDD LLIISSTTEEDD TTAAXXAABBLLEE NNOONN--CCOONNVVEERRTTIIBBLLEE DDEEBBEENNTTUURREESS AAGGGGRREEGGAATTIINNGG TTOO RRss.. 330000 CCRROORREESS WWIITTHH AA GGRREEEENNSSHHOOEE OOPPTTIIOONN TTOO RREETTAAIINN

OOVVEERRSSUUBBSSCCRRIIPPTTIIOONN –– PPPPUUDD SSEERRIIEESS II

(This is a Disclosure Document prepared in conformity with Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008 issued vide circular no. LAD-NRO/GN/2008/13/127878 dated June 06, 2008)

CREDIT RATING CRISIL has assigned AAA/Stable (Triple A with stable outlook) rating to these Debentures. This rating indicates highest

degree of safety with regard to timely payment of interest and principal on the instrument. The rating agency reserves the right to suspend, withdraw or revise the rating / outlook at any time on the basis of new information etc. The rating does not constitute an audit of the Issuer. The rating is not a recommendation to buy / sell or hold the rated instrument; it does not comment on the market

price or suitability for a particular investor.

LISTING

The Debentures are proposed to be listed on the Wholesale Debt Market segment of Bombay Stock Exchange Limited (BSE)

DEBENTURE TRUSTEE

IDBI Trusteeship Services Limited Asian Building, Ground Floor, 17, R Kamani Marg,

Ballard Estate, Mumbai 400001

REGISTRAR AND TRANSFER AGENT

Sharepro Services (India) Private Limited

06 May 2010

DISCLAIMER THIS PRIVATE PLACEMENT INFORMATION MEMORANDUM (HEREINAFTER REFERRED TO AS THE “INFORMATION MEMORANDUM””) IS NEITHER A PROSPECTUS NOR A STATEMENT IN LIEU OF PROSPECTUS. THE ISSUE OF PARTLY PAID, UNSECURED, REDEEMABLE, RATED, LISTED, TAXABLE, NON-CONVERTIBLE DEBENTURES (HEREINAFTER REFERRED TO AS “DEBENTURES”) TO BE ISSUED IN ONE OR MORE SERIES TO BE LISTED ON THE WHOLESALE DEBT MARKET (“WDM”) SEGMENT OF THE BOMBAY STOCK EXCHANGE LIMITED (“BSE”) IS BEING MADE STRICTLY ON A PRIVATE PLACEMENT BASIS AND IS NOT INTENDED TO BE CIRCULATED TO MORE THAN 49 ELIGIBLE INVESTORS. MULTIPLE COPIES HEREOF GIVEN TO THE SAME ENTITY SHALL BE DEEMED TO BE GIVEN TO THE SAME PERSON AND SHALL BE TREATED AS SUCH. IT DOES NOT CONSTITUTE AND SHALL NOT BE DEEMED TO CONSTITUTE AN OFFER OR AN INVITATION TO SUBSCRIBE TO THE DEBENTURES TO THE PUBLIC IN GENERAL. APART FROM THIS INFORMATION MEMORANDUM, NO OFFER DOCUMENT OR PROSPECTUS HAS BEEN PREPARED IN CONNECTION WITH THE OFFERING OF THIS ISSUE OR IN RELATION TO THE ISSUER NOR IS SUCH A PROSPECTUS REQUIRED TO BE REGISTERED UNDER THE APPLICABLE LAWS. ACCORDINGLY, THIS INFORMATION MEMORANDUM HAS NEITHER BEEN DELIVERED FOR REGISTRATION NOR IS IT INTENDED TO BE REGISTERED. THIS INFORMATION MEMORANDUM HAS BEEN PREPARED TO PROVIDE GENERAL INFORMATION ABOUT THE ISSUER TO POTENTIAL INVESTORS TO WHOM IT IS ADDRESSED AND WHO ARE WILLING AND ELIGIBLE TO SUBSCRIBE TO THE DEBENTURES. THIS INFORMATION MEMORANDUM DOES NOT PURPORT TO CONTAIN ALL THE INFORMATION THAT ANY POTENTIAL INVESTOR MAY REQUIRE. NEITHER THIS INFORMATION MEMORANDUM NOR ANY OTHER INFORMATION SUPPLIED IN CONNECTION WITH THE DEBENTURES IS INTENDED TO PROVIDE THE BASIS OF ANY CREDIT OR OTHER EVALUATION AND ANY RECIPIENT OF THIS INFORMATION MEMORANDUM SHOULD NOT CONSIDER SUCH RECEIPT A RECOMMENDATION TO PURCHASE ANY DEBENTURES. EACH INVESTOR CONTEMPLATING THE PURCHASE OF ANY DEBENTURES SHOULD MAKE ITS OWN INDEPENDENT INVESTIGATION OF THE FINANCIAL CONDITION AND AFFAIRS OF THE ISSUER, AND ITS OWN APPRAISAL OF THE CREDITWORTHINESS OF THE ISSUER. POTENTIAL INVESTORS SHOULD CONSULT THEIR OWN FINANCIAL, LEGAL, TAX AND OTHER PROFESSIONAL ADVISORS AS TO THE RISKS AND INVESTMENT CONSIDERATIONS ARISING FROM AN INVESTMENT IN THE DEBENTURES AND SHOULD POSSESS THE APPROPRIATE RESOURCES TO ANALYSE SUCH INVESTMENT AND THE SUITABILITY OF SUCH INVESTMENT TO SUCH INVESTOR’S PARTICULAR CIRCUMSTANCES. IT IS THE RESPONSIBILITY OF POTENTIAL INVESTORS TO ALSO ENSURE THAT THEY WILL SELL THESE DEBENTURES IN STRICT ACCORDANCE WITH THIS INFORMATION MEMORANDUM AND OTHER APPLICABLE LAWS, SO THAT THE SALE DOES NOT CONSTITUTE AN OFFER TO THE PUBLIC WITHIN THE MEANING OF THE COMPANIES ACT, 1956. BY SUBSCRIBING TO THE DEBENTURES, ELIGIBLE INVESTORS SHALL BE DEEMED TO HAVE ACKNOWLEDGED THAT THE ISSUER DOES NOT OWE THEM A DUTY OF CARE IN THIS RESPECT. ACCORDINGLY, NONE OF THE ISSUER’S OFFICERS OR EMPLOYEES SHALL BE HELD RESPONSIBLE FOR ANY DIRECT OR CONSEQUENTIAL LOSSES SUFFERED OR INCURRED BY ANY RECIPIENT OF THIS INFORMATION MEMORANDUM AS A RESULT OF OR ARISING FROM ANYTHING EXPRESSLY OR IMPLICITLY CONTAINED IN OR REFERRED TO IN THIS INFORMATION MEMORANDUM OR ANY INFORMATION RECEIVED BY THE RECIPIENT IN CONNECTION WITH THE ISSUE OF DEBENTURES. THE ISSUER HAVING MADE ALL REASONABLE INQUIRIES, ACCEPTS RESPONSIBILITY FOR AND CONFIRMS THAT THE INFORMATION CONTAINED IN THIS PRIVATE PLACEMENT INFORMATION MEMORANDUM IS TRUE AND CORRECT IN ALL MATERIAL ASPECTS AND IS NOT MISLEADING IN ANY MATERIAL RESPECT, THAT THE OPINIONS AND INTENTIONS EXPRESSED HEREIN ARE HONESTLY HELD AND THAT THERE ARE NO OTHER FACTS, THE OMISSION OF WHICH MAKE THIS DOCUMENT AS A WHOLE OR ANY OF SUCH INFORMATION OR THE EXPRESSION OF ANY SUCH OPINIONS OR INTENTIONS MISLEADING IN ANY MATERIAL RESPECT. NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED OR INCORPORATED BY REFERENCE IN THIS INFORMATION MEMORANDUM OR IN ANY MATERIAL MADE AVAILABLE BY THE ISSUER TO ANY POTENTIAL INVESTOR PURSUANT HERETO AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE ISSUER. THE ARRANGER HAS NOT INDEPENDENTLY VERIFIED THE CONTENTS OF THIS INFORMATION MEMORANDUM. ACCORDINGLY, NO REPRESENTATION, WARRANTY OR UNDERTAKING (EXPRESS OR IMPLIED) IS MADE AND NO RESPONSIBILITY IS ACCEPTED BY THE ARRANGER OR ANY OF THEIR OFFICERS AS TO THE ADEQUACY, COMPLETENESS OR REASONABLENESS OF THE INFORMATION CONTAINED HEREIN OR OF ANY FURTHER INFORMATION, STATEMENT, NOTICE, OPINION, MEMORANDUM, EXPRESSION OR FORECAST MADE OR SUPPLIED AT ANY TIME IN RELATION THERETO.

THE CONTENTS OF THIS INFORMATION MEMORANDUM ARE INTENDED TO BE USED ONLY BY THOSE INVESTORS TO WHOM IT IS DISTRIBUTED. IT IS NOT INTENDED FOR DISTRIBUTION TO ANY OTHER PERSON AND SHOULD NOT BE REPRODUCED BY THE RECIPIENT. THE PERSON TO WHOM A COPY OF THIS INFORMATION MEMORANDUM IS SENT IS ALONE ENTITLED TO APPLY FOR THE DEBENTURES. NO INVITATION IS BEING MADE TO ANY PERSONS OTHER THAN THOSE TO WHOM APPLICATION FORMS ALONG WITH THIS INFORMATION MEMORANDUM HAVE BEEN SENT. ANY APPLICATION BY A PERSON TO WHOM THE INFORMATION MEMORANDUM AND/OR THE APPLICATION FORM HAS NOT BEEN SENT BY THE ISSUER SHALL BE REJECTED WITHOUT ASSIGNING ANY REASON. ALL INVESTORS ARE REQUIRED TO COMPLY WITH THE RELEVANT REGULATIONS/GUIDELINES APPLICABLE TO THEM FOR INVESTING IN THIS ISSUE. IT IS THE RESPONSIBILITY OF THE ELIGIBLE INVESTORS TO HAVE OBTAINED ALL CONSENTS, APPROVALS OR AUTHORIZATIONS REQUIRED BY THEM TO PARTICIPATE IN THE ISSUE.

THE PERSON WHO IS IN RECEIPT OF THIS INFORMATION MEMORANDUM SHALL MAINTAIN UTMOST CONFIDENTIALITY REGARDING THE CONTENTS OF THIS INFORMATION MEMORANDUM AND SHALL NOT REPRODUCE OR DISTRIBUTE IN WHOLE OR PART OR MAKE ANY ANNOUNCEMENT IN PUBLIC OR TO A THIRD PARTY REGARDING ITS CONTENTS, WITHOUT THE PRIOR WRITTEN CONSENT OF THE ISSUER. EACH PERSON RECEIVING THIS INFORMATION MEMORANDUM ACKNOWLEDGES THAT SUCH

PERSON HAS BEEN AFFORDED AN OPPORTUNITY TO REQUEST AND TO REVIEW AND HAS RECEIVED ALL ADDITIONAL INFORMATION CONSIDERED BY THAT PERSON TO BE NECESSARY TO VERIFY THE ACCURACY OF OR TO SUPPLEMENT THE INFORMATION HEREIN AND HAS NOT RELIED ON ANY INTERMEDIARY THAT MAY BE ASSOCIATED WITH ISSUANCE OF THE INSTRUMENT IN CONNECTION WITH ITS INVESTIGATION OF THE ACCURACY OF SUCH INFORMATION OR ITS INVESTMENT DECISION.

THE ISSUER DOES NOT UNDERTAKE TO UPDATE THE INFORMATION MEMORANDUM TO REFLECT SUBSEQUENT EVENTS AFTER THE DATE OF THE INFORMATION MEMORANDUM AND THUS IT SHOULD NOT BE RELIED UPON WITH RESPECT TO SUCH SUBSEQUENT EVENTS WITHOUT FIRST CONFIRMING ITS ACCURACY WITH THE ISSUER. NEITHER THE DELIVERY OF THIS INFORMATION MEMORANDUM NOR ANY SALE OF DEBENTURES MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CONSTITUTE A REPRESENTATION OR CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE ISSUER SINCE THE DATE HEREOF. THIS INFORMATION MEMORANDUM DOES NOT CONSTITUTE, NOR MAY IT BE USED FOR OR IN CONNECTION WITH, AN OFFER OR SOLICITATION BY ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED OR TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION. NO ACTION IS BEING TAKEN TO PERMIT AN OFFERING OF THE DEBENTURES OR THE DISTRIBUTION OF THIS INFORMATION MEMORANDUM IN ANY JURISDICTION WHERE SUCH ACTION IS REQUIRED. THE DISTRIBUTION OF THIS INFORMATION MEMORANDUM AND THE OFFERING AND SALE OF THE DEBENTURES MAY BE RESTRICTED BY LAW IN CERTAIN JURISDICTIONS. PERSONS INTO WHOSE POSSESSION THIS INFORMATION MEMORANDUM COMES ARE REQUIRED TO INFORM THEMSELVES ABOUT AND TO OBSERVE ANY SUCH RESTRICTIONS. THE DEBENTURES HAVE NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “U.S. SECURITIES ACT”) AND MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES (AS DEFINED UNDER REGULATION S UNDER THE U.S. SECURITIES ACT), EXCEPT PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE U.S. SECURITIES ACT.

DISCLAIMER CLAUSE OF THE STOCK EXCHANGE

AS REQUIRED, A COPY OF THIS INFORMATION MEMORANDUM HAS BEEN FILED WITH THE BSE IN TERMS OF THE SECURITIES AND EXCHANGE BOARD OF INDIA (ISSUE AND LISTING OF DEBT SECURITIES) REGULATIONS, 2008 (THE “SEBI REGULATIONS”). IT IS TO BE DISTINCTLY UNDERSTOOD THAT SUBMISSION OF THIS INFORMATION MEMORANDUM TO THE BSE SHOULD NOT IN ANY WAY BE DEEMED OR CONSTRUED TO MEAN THAT THIS INFORMATION MEMORANDUM HAS BEEN REVIEWED, CLEARED OR APPROVED BY THE BSE; NOR DOES THE BSE IN ANY MANNER WARRANT, CERTIFY OR ENDORSE THE CORRECTNESS OR COMPLETENESS OF ANY OF THE CONTENTS OF THIS INFORMATION MEMORANDUM, NOR DOES THE BSE WARRANT THAT THE ISSUER’S DEBENTURES WILL BE LISTED OR WILL CONTINUE TO BE LISTED ON THE BSE; NOR DOES THE BSE TAKE ANY RESPONSIBILITY FOR THE SOUNDNESS OF THE FINANCIAL AND OTHER CONDITIONS OF THE ISSUER, ITS PROMOTERS, ITS MANAGEMENT OR ANY SCHEME OR PROJECT OF THE ISSUER. AS PER THE PROVISIONS OF THE SEBI REGULATIONS, A COPY OF THIS INFORMATION MEMORANDUM HAS NOT BEEN FILED WITH OR SUBMITTED TO THE SEBI. IT IS TO BE DISTINCTLY UNDERSTOOD THAT THIS INFORMATION MEMORANDUM SHOULD NOT IN ANY WAY BE DEEMED OR CONSTRUED TO HAVE BEEN APPROVED OR VETTED BY SEBI. SEBI DOES NOT TAKE ANY RESPONSIBILITY EITHER FOR THE FINANCIAL SOUNDNESS OF ANY PROPOSAL FOR WHICH THE DEBENTURES ISSUED THEREOF IS PROPOSED TO BE MADE OR FOR THE CORRECTNESS OF THE STATEMENTS MADE OR OPINIONS EXPRESSED IN THIS INFORMATION MEMORANDUM.

1

i. Name and address of the registered office of the issuer. LARSEN & TOUBRO LIMITED (“L&T” or “Issuer”)

L&T House, Ballard Estate, Mumbai – 400001 Phone: 91-22-67525656

Contact Persons: Mr P Ramakrishnan. Tel: 91-22-67525707, [email protected] Mr Alekh Gupta. Tel: 91-22-67525760, [email protected]

ii. Names and addresses of the directors of the issuer.

# Name & Designation Address

1 Mr. A.M. Naik Chairman & Managing Director

High Trees, 54 Pali Hill, Bandra West, Mumbai 400050

2 Mr. J.P. Nayak Whole Time Director & President (Machinery & Industrial Products)

Gilder House, 67-F, Bhulabhai Desai Road, Mumbai 400026

3 Mr. Y.M. Deosthalee Whole Time Director & Chief Financial Officer

1001, Pabhu Kutir, 15, Altamount Road, Mumbai 400026

4 Mr. K. Venkataramanan Whole Time Director & President (Engineering & Construction Projects)

401, Varsha, Janki Kutir, Juhu, Mumbai 400049.

5 Mr. R.N. Mukhija Whole Time Director & President (Electrical & Electronics)

501, Varsha, Janki Kutir, Juhu, Mumbai – 400049

6 Mr. K.V. Rangaswami Whole Time Director & President (Construction)

104, New Avadi Road, Kilpauk, Chennai 600010

7

Mr. V.K. Magapu Whole Time Director & Senior Executive Vice President (IT & Technology Services)

402/403, Verona, Hiranandani Gardens, Powai, Mumbai 400076.

8 Mr. M.V. Kotwal Whole Time Director & Senior Executive Vice President (Heavy Engineering)

803, Odyssey-2, Hiranandani Gardens, Powai, Mumbai 400076.

9 Mr. S. Rajgopal Non-Executive Director

232, Buena Vista, General Jagannath Bhosle Marg, Mumbai 400021.

10 Mr. S.N. Talwar Non-Executive Director

10, Shiv Shanti Bhuvan, 146, Maharshi Karve Road, Churchgate, Reclamation, Mumbai 400020

11 Mr. M.M. Chitale Non-Executive Director

4/43, Vishnuprasad CHS Society, Shahaji Raje Marg, Vile Parle (E), Mumbai 400057

12 Mr. Thomas Mathew T. Nominee - LIC

A1 Jeevan Jyot Setalwad lane, Napean Sea road, Mumbai 400036

2

13 Mr. N Mohan Raj Nominee - LIC

22, Gaurav Apartment, Sayani Road, Prabhadevi, Mumbai 400025

14 Mr. Subodh Bhargava Non-Executive Director

A-15/1, DLF City, Phase – I, Gurgaon, Haryana 122002

15 Mrs. Bhagyam Ramani Nominee - GIC

291/301, Kalpataru Heights, Agripada, Mumbai 400011.

16 Mr. A.K. Jain Nominee – Administrator of the Specified Undertaking of UTI

C-9, NDSE, Part II, New Delhi 110049.

17 Mr.Jagjeet Singh Bindra Non-Executive Director

7113, Lake Edge Drive Dallas, TX 75230

iii. A brief summary of the business/ activities of the issuer and its line of

business.

L&T is a technology, engineering and construction company with global operations. It is one of the largest and most respected companies in India’s private sector. A strong, customer-focused approach and the constant quest for top-class quality have enabled L&T to attain and sustain leadership in its major lines of business across seven decades. L&T has distinguished records of achievements including the world’s largest coal gasifier made in India and exported to China, India’s first indigenous hydrocracker reactor, oil and gas platform projects executed to global benchmarks and the world’s largest Continuous Catalyst Regeneration reactor. In the Engineering & Construction business, L&T operates as a contractor in key verticals including process industries, oil and gas, infrastructure, power, minerals, nuclear power and aerospace, water, civil structures, etc. It also undertakes turnkey projects in these fields. The Electrical and Electronics division is engaged in the business of low and medium voltage switchgear products, electrical systems, energy meters, medical equipment, control and automation solutions, etc. The Machinery & Industrial Products division manufactures machinery for paper & mining industry and rubber processing machinery. It also does trading and servicing of products manufactured by various associates, i.e., construction & hydraulic equipment, industrial valves, welding & industrial products.

iv. A brief history of the issuer since its incorporation giving details of its activities

including any reorganization, reconstruction or amalgamation, changes in its capital structure, (authorized, issued and subscribed) and borrowings, if any.

History of the Issuer: The Issuer was formed as a partnership in 1938 by Henning Holck-Larsen and Soren Kristian Toubro, two Danish engineers who came to India as representatives of F.L. Smidth & Co. A/S. The partnership venture was subsequently incorporated as a company in 1946.

3

The Issuer’s business originally consisted of fabrication. The Issuer then entered into the switchgear business. Entry into the construction business followed through a subsidiary which was merged with the Issuer in 1984. In the early 1960s, the Issuer commenced its valves and undercarriage manufacturing businesses. The Issuer’s heavy fabrication facilities were substantially expanded in 1968. The Issuer commenced manufacture of earth-moving equipment in 1976 and entered into the cement business in the early 1980s. In 1987, the Issuer established a fabrication facility and open yard on the waterfront at Hazira, which has enhanced its ability to fabricate and transport large structures. In the 1990s, the Issuer entered into the EPC business and formed engineering joint ventures such as L&T Chiyoda Limited for hydrocarbon engineering in the mid- and downstream sectors and L&T-Sargent & Lundy Limited for the power sector. In 1994, the Issuer set up L&T Finance to finance construction equipment manufactured by the Issuer and offer other financial products. In 1996, the Issuer set up L&T Infotech to further diversify its portfolio into information technology services. The cement business of the Issuer was demerged into UltraTech Cement Limited in 2004. In order to focus its strategy on key businesses including engineering, construction and technology, the Issuer discontinued its metal closures business in 2003 and sold its glass container business in 2005. The Issuer also divested its stake in its tractor manufacturing business (operated by L&T-John Deere Private Limited) and in its dairy plant manufacturing business (operated by L&T-Niro Limited) to its respective joint venture partners in 2005. In 2006, the Issuer inducted financial partners with strategic capabilities into L&TIDPL (its holding company for developmental projects) for a 21.6% stake in that company. To give impetus to the Issuer’s ventures in the fast-growing urban infrastructure business, L&T Urban Infrastructure Limited, or L&TUIL, was formed as a subsidiary of L&TIDPL in the same year. Shortly thereafter, strategic and financial partners acquired a 25% stake in L&TUIL. Between 2004 and 2006, the Issuer expanded its electrical products capabilities by acquiring Datar Switchgear Limited, entered into a joint venture with upstream engineering company, Valdel Corporation Private Limited (the Issuer increased its stake in the joint venture in 2007), acquired a niche technology company, Spectrum Infotech Private Limited, and acquired a controlling stake in International Seaport Dredging Limited from Dredging International. In 2007, the Issuer expanded its financial services business by setting up L&T Infrastructure Finance Company Limited to finance infrastructure development projects. In 2009, the Issuer acquired an asset management company and has taken steps to commence general insurance business. Over the past four years, the Issuer has been expanding its manufacturing facilities at Hazira, Mysore and Ahmednagar, and setting up new manufacturing facilities at Coimbatore, Talegaon and Navi Mumbai and design and engineering centres at Faridabad, Vadodara, and in the United Arab Emirates. The Issuer has expanded its production base overseas, setting up companies to manufacture switchgears, valves and rubber processing machinery in China and switchboards in Saudi Arabia. The Issuer has also set up a manufacturing facility for control and automation in the United Arab Emirates and a modular fabrication yard (“MFY”) in Oman. In addition, it is setting up a heavy engineering facility adjacent to the MFY.

4

The Issuer has ventured into new businesses, seeking to leverage its engineering and manufacturing strengths. It has commenced shipbuilding at its Hazira facility and is setting up a new shipyard-cum-port at Katupalli in South India. It has entered into joint ventures with Mitsubishi Heavy Industries Ltd for manufacturing boilers and turbine generators with supercritical technology. To complement its existing oil and gas business, the Issuer has entered into a joint venture with Sapura Crest Petroleum Berhad to own and operate a specialized vessel for deep sea pipe laying and platform installation, and a joint venture with Gulf Interstate Engineering USA for the design engineering of cross country pipelines. The Issuer has also recently entered into a joint venture for defence electronics, and has signed memoranda of understanding with global majors for opportunities in the nuclear power sector and the defence sector. Further, the Issuer recently acquired TAMCO Corporate Holding (“Tamco”), which provided the Issuer with an entry into the medium voltage switchgear segment in Malaysia, Indonesia, Australia and China. The Issuer has also made a foray into the railways sector and has won, amongst others, India’s first monorail project in Mumbai. To strengthen its heavy engineering capabilities, the Issuer is setting up a facility for manufacturing heavy forgings for the nuclear, hydrocarbon and other sectors, in a joint venture with the Nuclear Power Corporation of India. To capitalize on opportunities in the Indian infrastructure growth story, the Issuer has built a portfolio of development projects, focusing on roads, ports, airports and urban infrastructure. It has recently taken up development of power projects as well. The Issuer has divested its non-core businesses in glass, tractor, dairy plant manufacturing, ready-mix concrete and petroleum dispensing pumps in order to streamline and focus on its core business. It has also recently sold its minority stake in UltraTech Cement Limited, and reduced its stake to minority in International Seaport Dredging Limited. The Issuer has recently completed an internal reorganisation where complementary business units have been organised under vertically integrated businesses known as ‘operating companies’ (“OCs”). While these OCs are not separate legal entities, they have their own internal boards and embedded shared service functions, such as human resources, resource support, and finance and accounts, to enable self-sufficiency. The Issuer believes that the new structure will open up opportunities for leadership development, provide a platform for nurturing internal resources, and is also expected to provide focus to businesses within each OC. The Issuer has maintained a constant focus on corporate governance and financial management. This Year, L&T has won the Business Standard ‘Company of the Year’ award, while Business Today rated L&T as the Best Company to work for in the Manufacturing Sector. The Issuer released its maiden “Corporate Sustainability Report” in 2008 and a second one in 2009, in consonance with international standards under “Global Reporting Initiative (GRI) - G3” guidelines. The reports have received the highest rating of ‘A+’ under the external assurance of Ernst & Young. The Issuer featured among Forbes Asia’s Fabulous 50 companies for the third consecutive year (2007 to 2009), and was ranked as one of India’s Best Managed Companies by Finance Asia in 2009. NDTV Profit recognized L&T as India’s Best Company in the Infrastructure Sector and awarded the Business Leadership Award in 2009, 2007 and 2006. L&T was also the awarded the Top Indian Company award by Dun & Bradstreet in 2009. The Issuer’s corporate treasury management was awarded as the best in India in 2009 by Eurofinance, and its USD 600 million fundraising transaction of 2009 was rated as best in class in India by Asiamoney,

5

FinanceAsia and IFR Asia. In surveys conducted in 2007 and in 2008 by the Wall Street Journal (Asia) the Issuer was the only E&C company among the top ten Indian companies, with first rank in 2007 specifically for quality of products and reputation. The Issuer has been ranked as India’s most admired construction company by Construction World magazine in 2007, holding the title since 2005, and as India’s largest and most profitable construction company in 2006 by the same magazine. In 2008, it won the ICAI Gold Shield for Excellence in Financial Reporting in the Infrastructure and Construction Sector category and in 2006, the BSE’s best corporate social responsibility award. The Issuer also has won several awards in manufacturing, environmental management, exports, occupational safety, energy conservation, product innovation and quality and training.

Share Capital

As on 6 May 2010 Authorised 162,50,00,000 Equity shares of Rs. 2 each

Rs. 325,00,00,000

Issued 60,26,64,264 Equity shares of Rs. 2 each

Rs. 120,53,28,528

Paid Up 60,26,64,264 Equity shares of Rs. 2 each

Rs. 120,53,28,528

Changes in Issued Share Capital of the Issuer: (from January 2003 to 6 May 2010) Date Type of Issue Face

Value (Rs.)

Number of Shares Issued

Number of Shares Outstanding after Issue

29 January 2003 Conversion of Debentures

Rs. 10/- 2,695 248,668,756

21 November 2003

Employee Stock Options Rs. 10/- 1,700 248,670,456

21 November 2003

Conversion of Debentures

Rs. 10/- 69,135 248,739,591

30 December 2003 to 31 January 2004


14 May 2004 Restructuring of Capital Rs. 2/- — 124,401,796 25 October 2004 to 28 July 2005

Employee Stock Options Rs. 2/- 7,620,169 132,021,965

9 August 2005 Conversion of Convertible Bonds

Rs. 2/- 1,008 132,022,973

16 August 2005 Employee Stock Options Rs. 2/- 114,928 132,137,901 3 September 2005 to 9 December 2005

Conversion of Convertible Bonds

Rs. 2/- 2,665,620 134,803,521

16 December 2005


6

4 January 2006 to 7 March 2006


Rs. 2/- 2,508,471 137,357,053

21 March 2006 Employee Stock Options Rs. 2/- 28,724 137,385,777 5 April 2006 to 16 May 2006


Rs. 2/- 524,689 137,910,466

25 May 2006 to 7 June 2006


3 July 2006 Conversion of Convertible Bonds

Rs. 2/- 19,163 139,158,533

7 July 2006 to 21 July 2006.


7 August 2006 Conversion of Convertible Bonds

Rs. 2/- 10,086 139,938,782

1 September 2006


13 September 2006


Rs. 2/- 69,393 140,019,355

3 October 2006 Bonus shares Rs. 2/- 140,019,355 280,038,710 12 October 2006 Datar Switchgear Limited Rs. 2/- 2 280,038,712 2 November 2006 to 18 November 2006


Rs. 2/- 506,737 280,545,449

20 November 2006 to 29 January 2007


26 February 2007

Conversion of Convertible Bonds- II

Rs. 2/- 34,129 280,667,696

13 March 2007 to 29 May 2007


20 June 2007 Conversion of Convertible Bonds – II

Rs. 2/- 490,223 283,790,511

3 July 2007 Employee Stock Options

Rs. 2/- 14,900 283,805,411

16 July 2007 Conversion of Convertible Bonds – II

Rs. 2/- 366,116 284,171,527

19 July 2007 Employee Stock Options Rs. 2/- 7,379 284,178,906 6 August 2007 Conversion of

Convertible Bonds – II Rs. 2/- 2,379,760 286,558,666

23 August 2007 Employee Stock Options Rs. 2/- 4,913 286,563,579 24 September 2007

Conversion of Convertible Bonds – II

Rs. 2/- 214,084 286,777,663

26 October 2007 Employee Stock Options Rs. 2/- 440,477 287,218,140 13 November 2007

Global Depository Receipts

Rs. 2/- 4,000,000 291,218,140

12 April 2007 to 19 December 2007

Conversion of Convertible Bonds – II

Rs. 2/-

105,558 291,323,698

7

22 December 2007 to 20 September 2008


8 October 2008 Bonus shares Rs. 2/- 292,592,054 585,184,108 15 October 2008 Employee Stock Options Rs. 2/- 113,338 585,297,446 31 December 2008


30 January 2009 Employee Stock Options Rs. 2/- 239,444 585,577,324 24 March 2009 Employee Stock Options Rs. 2/- 110,538 585,687,862 7 April 2009 Employee Stock Options Rs. 2/- 9,550 585,697,412 28 May 2009 Employee Stock Options Rs. 2/- 552,070 586,249,482 17 August 2009 Employee Stock Options Rs. 2/- 1,379,768 587,629,250 15 October 2009 Qualified Institutional

Placement Rs. 2/- 11,286,685 598,915,935

22 October 2009 Employee Stock Options Rs. 2/- 1,356,878 600,272,813 21 January 2010 Employee Stock Options Rs. 2/- 1,502,907 601,775,720 22 February 2010


1 April 2010 Employee Stock Options Rs. 2/- 468,856 602,664,264 Borrowings: The outstanding borrowings of the Issuer, as on 31 March 2009 are given below.

(a) Secured Loans Nature of loan Lender Amount (Rs cr) Security Redeemable non-convertible fixed rate debentures

Trustee: IDBI Trusteeship Services Limited

900.00 Movable and Immovable Property

Working capital Consortium of banks 202.38 Stocks and book debts

(b) Unsecured Loans Nature of loan Lender Amount (Rs cr) Redeemable non-convertible fixed rate debentures

Trustee: IDBI Trusteeship Services Limited

250.00

Working capital Various banks 873.36 Lease Finance 146.26 Sales tax deferment loan 120.03 External Commercial Borrowing Various banks 3974.60 Other 85.00

In October 2009, the Issuer issued unsecured Foreign Currency Convertible Bonds of USD 200 million. The bonds are listed on the Singapore Stock Exchange and the Trustee is Citicorp International Limited, HongKong.

8

In April 2010, the Issuer issued unsecured Non-Convertible Debentures of Rs. 200 crores. The bonds are listed on the National Stock Exchange of India and the Trustee is IDBI Trusteeship Services Limited.

v. Details of debt securities issued and sought to be listed including face value,

nature of debt securities mode of issue i.e. public issue or private placement.

Instrument/Debenture Partly Paid, Unsecured, Redeemable, Rated, Listed, Taxable, Non-Convertible Debentures – PPUD Series I

Issue Size Rs. 300 crores with a greenshoe option to retain oversubscription

Mode of Issue Private placement Face value Rs. 10,00,000 per Debenture Issue Price At par to be paid in 2 installments:

• The first installment on the Deemed Date of Allotment • The last installment on the Fully Paid Up Date

vi. Issue size Issue size is Rs. 300 crores with a greenshoe option to retain oversubscription. vii. Details of utilization of the issue proceeds. The funds proposed to be raised through this private placement will be used for general

corporate purposes. viii. A statement containing particulars of the dates of, and parties to all material

contracts, agreements involving financial obligations of the issuer

The Issuer enters into a large volume of transactions having financial obligations. The contracts and documents listed below are or may be deemed to be material (not being contracts entered into in the ordinary course of the business carried on by the Issuer).

# Nature of Contract 1 Certified copy of the Memorandum & Articles of Association of the Issuer 2 Certified true copy of the resolution passed by the Board of Directors at the

meeting held on 21st January 2009 approving the issue of Debentures 3 Certified true copy of the resolution passed by the shareholders of the Issuer at

the Extraordinary General Meeting held on 21st August, 1989 under section 293(1)(d) of the Companies Act, 1956

4 Latest Annual Report of the Issuer, for the year ending on 31 Mar’09 5 Credit rating letter from CRISIL 6 Letter from IDBI Trusteeship Services Ltd. giving its consent to act as debenture

trustee ix. Details of other borrowings including any other issue of debt securities in past

9

The outstanding borrowings of the Issuer, as on 31 March 2009 are given below.

(a) Secured Loans Nature of loan Lender Amount (Rs cr) Security Redeemable non-convertible fixed rate debentures

Various. Trustee: IDBI Trusteeship Services Limited

900.00 Movable and Immovable Property

Working capital Consortium of banks 202.38 Stocks and book debts

(b) Unsecured Loans Nature of loan Lender Amount (Rs cr) Redeemable non-convertible fixed rate debentures

Various. Trustee: IDBI Trusteeship Services Limited

250.00

Working capital Various banks 873.36Lease Finance 146.26Sales tax deferment loan 120.03External Commercial Borrowing Various banks 3974.60Other 85.00

In October 2009, the Issuer issued unsecured Foreign Currency Convertible Bonds of USD 200 million. The bonds are listed on the Singapore Stock Exchange and the Trustee is Citicorp International Limited, HongKong. In April 2010, the Issuer issued unsecured Non-Convertible Debentures of Rs. 200 crores. The bonds are listed on the National Stock Exchange of India and the Trustee is IDBI Trusteeship Services Limited.

x. Any material event/ development or change at the time of issue or subsequent

to the issue which may affect the issue or the investor’s decision to invest / continue to invest in the debt secutities.

None. xi. Particulars of the debt securities issued (i) for consideration other than cash,

whether in whole or part, (ii) at a premium or discount, or (iii) in pursuance of an option.

The Issuer has not issued any debt security (i) for consideration other than cash, whether

in whole or part, (ii) at a premium or discount, or (iii) in pursuance of an option, in the last five years, and no such debt security is outstanding.

10

xii. A list of highest ten holders of each class or kind of securities of the issuer as on the date of application along with particulars as to number of shares or debt securities held by them and the address of each such holder

Top ten holders of Equity shares as on 30th April 2010:

# Name and address of the Shareholder No. of Shares %

1 Life Insurance Corporation of India Yogakshema, Jeevan Bima Marg, Mumbai - 400021

114817459 19.05

2 L&T Employees Welfare Foundation L&T House, Ballard Estate N M Marg, Mumbai - 400001

74404116 12.35

3 Unit Trust Of India Merchant Chambers,New Marine Lines, 41 Sir Vithaldas Thackersey Marg, Mumbai - 400020

52434655 8.70

4 Shares underlying GDRs: Citibank N A Custody Services, Trent House, G Block, Plot No. 60, BKC, Bandra East, Mumbai – 400051

15877653 2.63

5 General Insurance Corporation Of India Suraksha, 170, J. Tata Road, Churchgate, Mumbai – 400020

13004731 2.16

6 The New India Assurance Co.Ltd. New India Assurance Building, 87, M.G.Road, Fort, Mumbai - 400001

7630288 1.27

7 ICICI Prudential Life Insurance Company Ltd. Db AG,P.O. Box No.9014, Goregaon Post Office, Goregaon (East), Mumbai - 400063

7454595 1.24

8 National Insurance Company Ltd. Inv Dept. Everest House, 4th Floor, 46C, J. N. Road, Calcutta - 700071

4795368 0.80

9 HSBC Global Investment Funds A/C HSBC Global Investment Funds Mauritius HSBC Securities Services, 2nd Floor "Shiv", Plot No 139-140 B, Western Exp. Highway, Sahar Rd Junct, Vile Parle-E, Mumbai - 400057

3140324 0.52

10 The Oriental Insurance Company Limited Oriental House, P B 7037, A-25/27, Asaf Ali Road,New Delhi – 110002

3424482 0.57

Top ten holders of Long term Redeemable Non-Convertible Debentures as on

30th April 2010: 11.45% 5000 NCDs of Rs.10 Lac each:

# Name and address of the Debenture holder No. of

Debentures Amount (Rs.)

1 Life Insurance Corporation of India Investment Department, 6th Floor, West Wing, Central Office, Yogakshema, Jeevan Bima Marg, Mumbai 400021

4800 480,00,00,000

11

2 General Insurance Corporation of India Suraksha, 170, J.Tata Road, Churchgate, Mumbai 400020

200 20,00,00,000

9.15% 4000 NCDs of Rs.10 Lac each:

# Name and address of the Debenture holder No. of

Debentures Amount (Rs.)

1 SBI Life Insurance Company HDFC Bank Limited Custody Services, Lodha-I Think Techno Campus, 8th Flr, Next To Kanjurmarg Railway Station, Kanjurmarg E, Mumbai 400042

1200 120,00,00,000

2 ICICI Prudential Life Insurance Company Limited Deutsche Bank AG, DB House, Hazarimal Somani Marg, Post Box No. 1142, Fort, Mumbai 400001

850 85,00,00,000

3 ING Vysya Life Insurance Company Citibank N A, Custody Services, 3rd Flr, Trent House, G Block, Plot No. 60, BKC, Bandra East, Mumbai 400051

450 45,00,00,000

4 HDFC Standard Life Insurance Company C/O HDFC Bank Limited Custody Services, Lodha-I Think Techno Campus, 8th Flr, Next To Kanjurmarg Railway Station, Kanjurmarg E, Mumbai 400042

450 45,00,00,000

5 Birla Sun Life Insurance Company Limited Deutsche Bank AG, DB House, Hazarimal Somani Marg, Post Box No. 1142, Fort, Mumbai 400001

350 35,00,00,000

6 MAX New York Life Insurance Company Limited HSBC Securities Services, 2nd Floor "Shiv", Plot No.139-140b, Western Exp Highway, Sahar Rd Junction, Vile Parle-E, Mumbai 400057

200 20,00,00,000

7 The J and K Bank Investment Department (DEBT), 5th Floor, Merchant Chambers, 41, New Marine Lines, Mumbai 400020

150 15,00,00,000

8 NPS Trustees – SBI Pension Fund Scheme 1 C/O SBI Pension Funds Pvt. Ltd.,No. 32, Maker Chambers – III, Nariman Point, Mumbai 400021

139 13,90,00,000

9 Star Union-Dai Ichi Life Insurance Company LimitedDeutsche Bank AG, DB House, Hazarimal Somani Marg, Post Box No. 1142, Fort, Mumbai 400001

50 5,00,00,000

10 National Insurance Company Limited Inv Dept, Everest House, 4th Floor, 46 C, J. N. Road, Calcutta 700071

50 5,00,00,000


# Name and address of the Debenture holder No. of Debentures

Amount (Rs.)

1 SBI Life Insurance Company Limited HDFC Bank Limited Custody Services, Lodha-I Think

750 75,00,00,000

12

Techno Campus, 8th Flr, Next To Kanjurmarg Railway Station, Kanjurmarg E, Mumbai 400042

2 RBS Financial Services (India) Private Limited C/O ABN Amro Bank N V Custody Dept, Brady House, 1st Flr 14 Veer Nariman Road, Fort Mumbai 400023

250 25,00,00,000

3 The New India Insurance Company New India Assurance Building 87, M.G.Road, Fort, Mumbai 400001

250 25,00,00,000

4 Max New York Life Insurance Company Limited HSBC Securities Services, 2nd Floor "Shiv", Plot No.139-140b, Western Exp Highway, Sahar Rd Junction, Vile Parle-E, Mumbai 400057

250 25,00,00,000

5 Standard Chartered Bank (Mauritius) Limited Standard Chartered Bank (Mauritius) Securities Services, 23-25 M.G. Road, Fort, Mumbai 400001

200 20,00,00,000

6 Kotak Mahindra Old Mutual Life Insurance Company Deutsche Bank AG, DB House, Hazarimal Somani Marg, Post Box No. 1142, Fort, Mumbai 400001

150 15,00,00,000

7 ICICI Securities Primary Dealership Limited ICICI Centre, H T Parekh Marg, Churchgate, Mumbai 400020

150 15,00,00,000

8 Syndicate Bank F I M Department, Maker Towers E, II Floor, Cuffe Parade, Colaba, Mumbai 400005

100 10,00,00,000

9 TATA AIG Life Insurance Company Limited HSBC Securities Services, 2nd Floor "Shiv", Plot No.139-140b, Western Exp Highway, Sahar Rd Junction, Vile Parle-E, Mumbai 400057

100 10,00,00,000

10 UCO Bank Treasury Branch, UCO Bank Building, Mezzanine Floor, 359 Dr DN Road, Fort, Mumbai 400001

100 10,00,00,000


1 The Hongkong and Shanghai Banking Corp. Ltd. HSBC Securities Services 2nd Floor "Shiv", Plot No 139-140 B, Western Exp. Highway, Sahar Road Junction Vile Parle-East, Mumbai 400057

800 80,00,00,000

2 Punjab And Sind Bank H.O. Funds Management Dept 1st floor 'Bank House' 21 Rajendra Palace, New Delhi 110008

300 30,00,00,000

3 United India Insurance Company Limited 24, Whites road chennai 600014

200 20,00,00,000

4 Agriculture Insurance Company of India Limited 13th floor,Ambadeep building Kasturba Gandhi Marg, Connaught Place, New Delhi 110001

200 20,00,00,000

5 Future Generali India Life Insurance Co. Ltd-Shareholders / Non Unit Linked

100 10,00,00,000

13

Citibank N. A. custody services, 3rd flr Trent House, G Block Plot No. 60, BKC, Bandra East Mumbai 400051

6 MAX New York Life Insurance Company Limited HSBC securities services, 2nd floor"Shiv", Plot No.139-140 b Western Exp Highway, Sahar Rd Junction Vile Parle-East, Mumbai 400057

100 10,00,00,000

7 Metlife India Insurance Company Limited Deutsche Bank AG DB House, Hazarimal Somani Marg, Post Box No. 1142, Fort Mumbai 400001

100 10,00,00,000

8 The Oriental Insurance Company Limited Oriental House, P B 7037, A-25/27, Asaf Ali Road, New Delhi 110002

100 10,00,00,000

9 Future Generali India Insurance Co Ltd. HDFC Bank Ltd, Custody Services Lodha - I Think Techno Campus Off Flr 8, Next To Kanjurmarg Stn Kanjurmarg East, Mumbai 400042

50 5,00,00,000

10

IDBI Fortis Life Insurance Company Ltd Trade View Oasis Complex, P. B. Marg Lower Parel (West) Mumbai 400013

50 5,00,00,000

Foreign Currency Convertible Bonds (FCCBs) as on 30th April 2010:

# Name & Address of Trustee No. of FCCBs

Amount (USD)

1 Citicorp International Limited 39th Floor, ICBC Tower, Citibank Plaza, 3 Garden Road, Central, Hong Kong

2000 200,000,000

xiii. An undertaking that the issuer shall use a common form of transfer

The Issuer shall issue the Debentures in dematerialised form only. The Debentures shall be transferred subject to and in accordance with the rules/ procedures as prescribed by the NSDL/ CDSL/ Depository Participant of the transferor/ transferee and any other applicable laws and rules notified in respect thereof and subject to the terms and conditions of issuance as contained in this Information Memorandum. The normal procedure followed for transfer of securities held in dematerialized form shall be followed for transfer of these Debentures held in electronic form. The seller should give delivery instructions containing details of the buyer’s DP account to his depository participant.

However the Issuer would use a common transfer form for physical holdings if at a later stage there is some holding in physical form due to rematerialisation option exercised by any investor. The Debentures cannot be traded during the Stop Period.

xiv. Redemption amount, period of maturity, yield on redemption.

14

Redemption amount: at par, Rs. 300 crores or higher if greenshoe option is exercised Period of maturity: 10 years from the Deemed Date of Allotment

xv. Information relating to the terms of offer or purchase.

Issuer Larsen & Toubro Limited Instrument/ Debenture

Partly Paid, Unsecured, Redeemable, Rated, Listed, Taxable, Non-Convertible Debentures – PPUD Series I

Debenture Trustee IDBI Trusteeship Services Limited Registrar and Transfer Agent (“RTA”)

Sharepro Services (India) Private Limited

Arranger/Underwriter Barclays Bank PLC, Mumbai Branch Issue Size Rs. 300 crores with a greenshoe option to retain

oversubscription Minimum Subscription

Not applicable, subscription in multiples of 1 Debenture

Tenure 10 years (120 months from the Deemed Date of Allotment) Issue Opens on Friday, 7 May 2010 Issue Closes on Tuesday, 11 May 2010 Pay-In Date Tuesday, 11 May 2010 Deemed Date of Allotment

Tuesday, 11 May 2010

Maturity Date Monday, 11 May 2020 Put / Call option None Coupon • 8.75% p.a. on the Initially Paid Up Amount (on the

Debentures not forfeited) from the Deemed Date of Allotment to the Fully Paid Up Date (excluding the Fully Paid Up Date), i.e for a period of 365 days

• 9.15% p.a. on the Face Value from the Fully Paid Up Date to the Maturity Date

Initially Paid Up Amount

10% of the Face Value of the Debentures (i.e. Rs. 100,000 per Debenture)

Balance Amount 90% of the Face Value of the Debentures (i.e. Rs. 900,000 per Debenture) to be paid on the Fully Paid Up Date

Fully Paid Up Amount

The sum of the Initially Paid Up Amount and the Balance Amount

Rating Downgrade Event

The credit rating of any senior debt of the Issuer being lower than AAA as on the Fully Paid Up Date by any SEBI accredited rating agency

Rating Downgrade Interest

On occurrence of a Rating Downgrade Event, an additional coupon on the Debentures will be paid to the extent of 0.25% p.a. for every notch below AAA over and above the Coupon payable on the Debentures on and from one day after the Fully Paid Up Date to the Maturity Date

Mode of Issue Private placement Dematerialized Yes Trading Dematerialised mode only Depository NSDL/ CDSL

15

Rating “AAA/ (Stable)” (pronounced “Triple A with stable outlook”) by CRISIL

Face value Rs. 10,00,000 per Debenture Issue Price At Par to be paid in 2 installments:

• The first installment on the Deemed Date of Allotment • The last installment on the Fully Paid Up Date

Payment Terms The terms of payment of the Face Value of the Debentures is as follows: • First Installment - 10% of the Face Value of the

Debentures (i.e. Rs. 100,000 per Debenture) to be paid on the Deemed Date of Allotment

• Last Installment - 90% of the Face Value of the Debentures (i.e. Rs. 900,000 per Debenture) to be paid on the Fully Paid Up Date

Failure to pay the last installment in full in respect of any Debenture on the Fully Paid Up Date will result in such Debentures for which only the Initially Paid Up Amount or a part of the Balance Amount has been paid, being forfeited. Investors shall not be entitled to any redemption rights or the Coupon accrued on the forfeited Debentures. On occurrence of an Event of Default, the Investor is free from the obligation to pay the Balance Amount and can accelerate redemption of the Initially Paid Up Amount and seek Coupon accrued till date.

Fully Paid Up Date The date falling 365 days from the Deemed Date of Allotment i.e. Wednesday, 11 May 2011

Coupon Payment Date

The Coupon Payment Date shall be the 11th of May of every year (or the next Business Day, if such day is not a Business Day), till the Maturity Date. Provided that the first Coupon Payment Date will be one Business Day after the Fully Paid Up Date i.e. Thursday, 12 May 2011. Interest on interest shall be paid on the 1 day by which Coupon payment has been delayed, at 8.75% p.a. Refer Annexure 6 to this Information Memorandum for a detailed schedule

Redemption At par, bullet repayment on the Maturity Date Settlement by way of cheque(s)/ redemption warrants(s)/ demand

draft(s)/ credit through RTGS/ NEFT/ funds transfer in the name of the investors as specified in paragraph on ‘Payment on Redemption’ below

Stop Period The period starting 5 Trading Days prior to the Record Date for Notice and ending on the Fully Paid Up Date, both days inclusive, i.e. between Tuesday, 24 April 2011 and Wednesday, 11 May 2011. In case a Trading Day is declared a holiday, then

16

the period of 5 Trading Days shall be reduced by such holidays, such that the Record Date for Notice remains unchanged.

Stop Period Intimation

The Issuer shall intimate the BSE by way of written notice of the commencement of the Stop Period at least 10 Business Days prior to the Record Date for Notice

Restriction on Trading

No trading of the Debentures is permitted during the Stop Period

Record Date for Notice

The date falling 356 days from the Deemed Date of Allotment i.e., Monday, 2 May 2011

Record Date(s) for Interest

The Record Date for First Interest Payment and the Record Dates for Subsequent Interest Payments

Record Date for First Interest Payment

The Record Date for Notice

Record Date(s) for Subsequent Interest Payments

The date falling 7 Business Days prior to the respective Coupon Payment Date

Interest Frequency Simple interest paid annually, rear-ended Day Count Basis Actual / Actual Trading Day Means a day on which BSE is open for trading Business Days Any day on which commercial banks are open for business in

Mumbai Security Unsecured Representations and Warranties

As customary for issues of this nature and as may be agreed mutually between the Issuer and the Debenture Trustee.

Covenants/ Undertakings

As customary for a transaction of this nature, applicable as appropriate to the Issuer or as mutually agreed, and to include without limitation:

a) provision of financial and other information; b) notification of any potential Event of Default or Event of

Default; c) obtain, comply with and maintain all licenses /

authorizations; and d) compliance with environmental and other laws.

Events of Default As customary for a transaction of this nature, applicable as

appropriate to the Issuer, and to include, without limitation: a) failure to pay any sum when due; b) breach of covenant, including financial covenant, or

other obligations c) representations or warranties found to be untrue or

misleading when made or deemed repeated; d) cross default; e) insolvency and related events; f) enforcement proceedings and attachment; g) cessation of business; and h) failure to list or cessation of listing or failure to

dematerialize the Debentures

17

each to be described in more detail in the documents to be entered into by the Issuer and Debenture Trustee.

Listing The Debentures are proposed to be listed on Wholesale Debt Market segment of BSE

Who can invest Only the investors specifically approached by the Issuer can apply for this Debenture issue. The following categories of investors are eligible to purchase the Debentures in the primary issue: • Commercial Banks and Financial Institutions; • Asset Management Companies; • Companies (within the meaning of the Companies Act, 1956), Bodies Corporate

and Societies; • Insurance Companies; • Regional Rural Banks; • Co-operative Banks; and • NBFCs and Residuary NBFCs. However, out of the aforesaid class of investors eligible to invest, this Disclosure Document is intended solely for the use of the person to whom it has been sent by the Issuer for the purpose of evaluating a possible investment opportunity by the recipient(s) in respect of the securities offered herein, and it is not to be reproduced or distributed to any other persons (other than professional advisors of the prospective investor receiving this Disclosure Document from the Issuer). All investors are required to comply with the relevant regulations/ guidelines applicable to them for investing in this issue of Debentures. Documents to be provided by investors Investors in the private placement, need to submit the following documentation as applicable

• Memorandum and Articles of Association / Documents Governing Constitution • Resolution authorising investment • Certified True Copy of the Power of Attorney • Specimen signatures of the authorised signatories duly certified by an appropriate

authority • PAN • Application form (including RTGS and Demat account details)

Mode of Payment by Investors All payments must be made by RTGS/ NEFT/ Funds transfer, or high value cheques/drafts made payable to “Larsen & Toubro Limited” and crossed “A/C PAYEE ONLY”, payable at Mumbai, on the Deemed Date of Allotment, and not on a Saturday. Interest will accrue from the Deemed Date of Allotment.

18

Deemed Date of Allotment The deemed date of allotment will be Tuesday, 11 May 2010, (the “Deemed Date of Allotment”). All benefits relating to the Debentures will be available to the investors from the Deemed Date of Allotment. The actual allotment of Debentures may take place on a date other than the Deemed Date of Allotment. Record Date For payment of interest for the first year from the Deemed Date of Allotment, the record date for payment of interest by the Issuer shall be the Record Date for Notice. The record date for payments by the Issuer of interest and redemption shall be the Record Date for Interest. Payment of Balance Amount on the Debentures On the Record Date for Notice, the RTA will send notices to the investors of the Debentures as of such Record Date of Notice, in the format prescribed as Annexure 4 to this Information Memorandum, requesting the investors to pay the balance amount due on the Debentures being 90% of the Face Value of the Debentures (i.e., Rs. 900,000 per Debenture or the “Balance Amount”) along with payment instructions. The account to which the investors are required to make the payment of the Balance Amount will be the same as the account into which the investors had made the payments for the Initially Paid up Amount, unless otherwise intimated by the Issuer/ RTA. Investor Confirmation At the time of making the payment for the Balance Amount(s) required to be paid prior to the Fully Paid Up Date, the investors are required to submit to the RTA, the form as per Annexure 5 to this Information Memorandum which shall clarify the number of Debentures which are being fully paid up. Such form shall be subject to the scrutiny of the RTA and if in the opinion of the RTA the information contained in the form is erroneous, the RTA shall have the sole discretion to determine the number of Debentures which have been fully paid up. Henceforth the Investor will be entitled to the rights attached to the Debentures as contained herein for the fully paid up Debentures only and the Issuer shall undertake the necessary procedure to cancel the remaining Debentures. Forfeiture of the Debentures The failure on the part of the investors to pay the whole of the Balance Amount on any of the Debentures on the Fully Paid Up Date, will result in such Debentures for which the Initially Paid Up Amount but less than the whole of the Balance Amount has been paid, being forfeited. Investors shall not be entitled to any redemption rights or the Coupon accrued on the forfeited Debentures.

19

The number of Debenture(s), if any, forfeited by an investor will be determined by the RTA on the basis of the payment of Balance Amount(s) made by such investor details of which will be submitted by such investor to the RTA in the form attached as Annexure 5 to this Information Memorandum. Restrictions on Trading The Debentures shall not be permitted to be traded during the Stop Period. The Issuer shall notify the BSE to stop trading 10 (ten) Business Days prior to the Record Date for Notice. Interest on Application Money No interest is payable on the application money since the Pay-In Date and the Deemed Date of Allotment is the same, i.e. May 11, 2010. Payment of Interest The payment of interest on the Debentures will be made by the Issuer to the beneficiaries as per the beneficiary list provided by the depository as on the Record Date for Notice or the Record Date(s) for Interest (as the case may be), by funds transfer/ RTGS/ NEFT. Interest for each of the interest periods shall be calculated and paid as follows:

For the first year - The first Coupon payment at 8.75% p.a. will be paid on the Initially Paid Up Amount from the Deemed Date of Allotment till the Fully Paid Up Date (excluding the Fully Paid Up Date). Provided that the first Coupon Payment Date will be one Business Day after the Fully Paid Up Date i.e. Thursday, 12 May 2011. Interest on interest shall be paid on the 1 day by which Coupon payment has been delayed, at 8.75%.

For the second year onwards – The Coupon payment at 9.15% p.a. (plus applicable Rating Downgrade Interest, if any) will be paid on the Face Value of principal outstanding on the Debentures, till the Debentures are redeemed. The Coupon Payment Date shall be the 11th of May for each year (or the next Business Day, if such day is not a Business Day), till the Maturity Date.

In case of default in payment of interest and/or principal redemption on the due dates, additional interest @ 2% p.a. over the documented rate will be payable by the Issuer for the defaulting period. Effect of Holidays Should any of the dates on which a payment is to be made fall on a Saturday, Sunday or a public holiday, the payment shall be made on the next Business Day.

Tax Deduction at Source Tax as applicable under the Income Tax Act, 1961, or any other statutory modification or reenactment thereof will be deducted at source. For seeking TDS exemption/lower rate of TDS, relevant certificate / document must be lodged by the debenture holders at the

20

registered office of the Issuer at least 30 days before the interest payment becoming due and if required, be submitted afresh annually and/or as and when called upon for the same by the Issuer. Tax exemption certificate / declaration of non-deduction of tax at source on interest on application money, should be submitted along with the application form attached in Annexure 3 to this Information Memorandum. Failure to comply with the above shall entitle the Issuer to deduct tax at source as may be advised to it.

Payment on Redemption Payment on redemption will be made by way of cheque(s)/ redemption warrants(s)/ demand draft(s)/ credit through RTGS/ NEFT/ funds transfer in the name of the investors whose names appear on the List of Beneficial Owners given by Depository to the Issuer as on the last Record Date for Interest. The Debentures held in the dematerialised form shall be taken as discharged on payment of the redemption amount by the Issuer on maturity to the registered investors whose name appears in the Register of debenture holders on the last Record Date for Interest. Such payment will be a legal discharge of the liability of the Issuer towards the investors. On such payment being made, the Issuer will inform NSDL/CDSL and accordingly the account of the investors with NSDL /CDSL will be adjusted. The Issuer's liability to the investors towards all their rights including for payment or otherwise shall cease and stand extinguished from the due dates of redemption in all events. Further the Issuer will not be liable to pay any interest or compensation from the dates of such redemption. On the Issuer dispatching the amount as specified above in respect of the Debentures, the liability of the Issuer shall stand extinguished. Purchase and Sale of Debentures by the Issuer The Issuer may, at any time and from time to time, purchase the Debentures at the price available in the debt market in accordance with the applicable laws. Such Debentures may, at the option of the Issuer, be cancelled, held or reissued at such a price and on such terms and conditions as the Issuer may deem fit and as permitted by law. Re-issue of Debentures Where the Issuer has redeemed any such Debentures, subject to the provisions of Section 121 of the Companies Act and other applicable provisions, the Issuer shall have and shall be deemed always to have had the right to keep such Debentures alive for the purpose of reissue and in exercising such right, the Issuer shall have and shall be deemed always to have had the power to re-issue such Debentures either by re-issuing the same Debentures or by issuing other Debentures in their place.

Governing Law The Debentures are governed by and shall be construed in accordance with the Indian laws. Any dispute arising thereof will be subject to the exclusive jurisdiction of the courts at Mumbai (Maharashtra).

21

xvi. The discount at which such offer is made and the effective price for the investor as a result of such discount.

The offer is at par. The Face Value of the Debentures is however payable in two

installments: first installment (for the Initially Paid Up Amount) on the Deemed Date of Allotment and the second and last installment (for the Balance Amount) on the Fully Paid Up Date.

xvii. The debt equity ratio prior to and after issue of the debt security.

Pre issue (Rs. cr.) (1) Post issue (Rs. cr.) (2) Debt 7783 8283 Net worth 17579 17579 Debt/ Equity ratio 0.44 0.47

(1) Figures as at 31 December 2009 (2) Figures as at 31 December 2009 + Debt issue of Rs. 200 crores completed in April

2010 + Proposed debt issue of Rs. 300 crores (without accounting for the greenshoe option)

xviii. Servicing behavior on existing debt securities, payment of due interest on due

dates on term loans and debt securities.

The payment of interest & repayment of principal is being done in a timely manner on the respective due dates.

xix. That the permission / consent from the prior creditor for a second or pari passu

charge being created in favor of the trustees to the proposed issue has been obtained.

No such consent is required since the Debentures are unsecured. xx. The names of the debenture trustee(s) shall be mentioned with a statement to

the effect that debenture trustee(s) has given his consent to the issuer for his appointment under regulation 4 (4) and also in all the subsequent periodical communications sent to the holders of debt securities.

The debenture trustee of the proposed debenture is: IDBI Trusteeship Services Limited Asian Building, Ground Floor, 17, R Kamani Marg, Ballard Estate, Mumbai 400001 Tel: 91-22- 40807000. Fax: 91-22- 66311776, 22625247 Consent letter from Debenture Trustee is attached as Annexure 1 to this Information Memorandum.

22

xxi. The rating rationale (s) adopted by the rating agencies shall be disclosed

CRISIL has assigned “AAA/ (Stable)” (pronounced “Triple A with stable outlook”) rating to these Debentures. Credit Rating Letter from CRISIL is attached as Annexure 2 to this Information Memorandum. The rating agencies publish the rating rationale on their websites.

xxii. Names of all the recognised stock exchanges where securities are proposed to

be listed clearly indicating the designated stock exchange and also whether in principle approval from the recognised stock exchange has been obtained.

The securities are proposed to be listed on the Wholesale Debt Market segment of The Bombay Stock Exchange Limited (BSE). In principle approval shall be applied for from the BSE for the listing. The Issuer shall apply for listing the Letters of Allotment / Debentures within 7 Business Days of the Deemed Date of Allotment.

xxiii. Summary term sheet including information pertaining to the secured/ unsecured non convertible debt securities (or series thereof) as follows (where relevant):

Please refer to section xv of this Information Memorandum for the necessary information.

23

Annexure 1

24

Annexure 2 Two rating letters are attached. Of the first (dt. 8 Apr’10), the rating on Debentures of Rs. 150 crore is available for this Issue. The rating on balance Rs. 150 crore Debentures is used from the second letter (dt 6 May 2010).

26

Annexure 3

APPLICATION FORM

Larsen & Toubro Limited Registered Office: L&T House, N.M Road, Ballard Estate, Mumbai 400 001

Phone No. 91 22 67525647 Fax No. 91 22 67525871, 67525612 Application No.: Date: ___________ Dear Sirs, Sub. : Issue of 3,000 Partly Paid Unsecured NCDs – PPUD Series I of the face value of Rs. 10,00,000 each, for cash at par, aggregating Rs. 300 crores with a greenshoe option to retain oversubscription on Private Placement basis Having read and understood the contents of the Information Memorandum of Private Placement, We apply for allotment to us of the Debentures. The amount payable on application is remitted herewith. We bind ourselves by the terms and conditions as contained in the Information Memorandum of Private Placement.

Application and Payment details No. of debentures applied for:

No. in figures No. in words

Face Value of the Debentures

Rs. 10,00,000 payable in 2 installments of 10% of the Face Value as of the date today and remaining 90% of the Face Value on the Fully Paid Up Date (as defined in the Information Memorandum)

Amount (Rs.) in figures (being 10% of the Face Value of the Debentures)

Amount (Rs.) in words (being 10% of the Face Value of the Debentures)

Payment Mode (tick one): [ ] Cheque [ ] RTGS/ NEFT [ ] Demand Draft

Cheque/ Demand Draft No.

Date Cheque/Demand Draft drawn on.

Applicant’s Name & Address in full (Please use Capital Letters)

Pin Code:

Tel: Fax: E-mail:

Status: [ ] Banking Company [ ] Others – Please specify

27

Name of Authorised

Signatory Designation Signature

1.

2.

3.

4.

Details of Bank Account Bank Name and Branch

Nature of Account Account No.

Bank IFSC Code

Depository Details DP Name

DP ID Client ID

We understand that in case of allotment of Debentures to us, our beneficiary account as mentioned above would be credited to the extent of Debentures allotted. Tax Details Taxpayer’s PAN or GIR No.

IT Circle/Ward/District [ ] Not Allotted

Tax Deduction Status:

[ ] Fully Exempted/ Lower rate of TDS (Please attach relevant certificate issued by Income Tax authorities)

[ ] Tax to be deducted at Source, as per prevailing income tax law

------------------------------------------------(Tear here)----------------------------------------------------

Larsen & Toubro Limited

L&T House, N.M Marg, Ballard Estate, Mumbai 400 001 Phone No. 91 22 67525647 Fax No. 91 22 67525871, 67525612

Issue of 3,000 Partly Paid Unsecured NCDs – PPUD Series I of the face value of Rs. 10,00,000 each, for cash at par, aggregating Rs. 300 crores with a greenshoe option to retain oversubscription on Private Placement basis

ACKNOWLEDGEMENT SLIP

Application No. : _________________ Date: ________________ Received from__________________________________________________________________ Rs._____________________ /- by RTGS/ NEFT/ Cheque / Demand Draft No. ________________ Dated ________ drawn on _______________________________________________________ towards application for _________ Debentures. (Cheques / Demand Drafts are subject to realization)

28

Annexure 4

FORMAT OF NOTICE TO BE PROVIDED BY THE ISSUER AND SENT BY THE RTA TO INVESTORS

To, [insert details of the Investor] [insert address of Investor] Attention: [●] Balance Payment on the Issue of 3,000 Partly Paid Unsecured NCDs – PPUD Series I of the face value of Rs. 10,00,000 each, for cash at par, aggregating Rs. 300 crores with a greenshoe option to retain oversubscription on Private Placement basis

Dear Sir, With reference to the captioned issue and as required as per the terms of issue of the captioned Debentures, we seek payment of the balance amount as follows:

Date when Balance

Amount is Due

Account Details to which such Balance Amount has been

remitted

Number of Partly Paid Debentures

held

Balance Amount Due per

Debenture

Total Balance Payment Due

11 May 2011

Rs. 900,000

Regards, For [L&T Official] Address: Telephone: Fax: Email:

29

Annexure 5

INVESTOR CONFIRMATION FORM

Date: [●] To, [insert details of the RTA] [insert address of RTA] Attention: [●] Re: Balance Payment on the Issue of 3,000 Partly Paid Unsecured NCDs – PPUD Series I of the face value of Rs. 10,00,000 each, for cash at par, aggregating Rs. 300 crores with a greenshoe option to retain oversubscription on Private Placement basis

Dear Sir, With reference to the captioned issue and as required as per the terms of issue of the captioned Debentures, we confirm as follows: Date of remitting the Balance Amount

Account Details to which such Balance Amount has been remitted

Number of Partly Paid Debentures held

Balance Amount Due per Debenture

Number of Debentures for which Balance Amount Due is being Paid

Balance Amount Paid per Debenture

Total Balance Payment made

Rs. 900,000 Rs. 900,000

The total balance payment made as shown above is remitted herewith through [Insert payment mode details]. The undersigned for and on behalf of the investor undertakes and acknowledges that the information provided in this confirmation is subject to the scrutiny of the Registrar and Transfer Agent being [●] (RTA). To the extent that the information provided in this confirmation is found incorrect, the RTA has the sole and irrevocable discretion to determine the number of Debentures for which payment of the Balance Amount has been made. We certify that all information set forth herein is correct and true. Regards, For [Investor Name] Address: Telephone: Fax:

30

Email: ======================================================================================= Attach copy of Notice received from the Issuer

31

Annexure 6

Day Date Event Tuesday 11-May-10 Pay-in Date & Deemed Date of Allotment Wednesday 11-May-11 Fully Paid Up Date

Thursday 12-May-11 Coupon Payment for 1st Year – for 365 days & Interest on Interest for 1 day

Friday 11-May-12 Coupon Payment for 2nd Year – for 365 days … 11-May-13 Next Coupon Payment (if sat or sun, next business day) … 11-May-14 Next Coupon Payment (if sat or sun, next business day) 11-May-15 Next Coupon Payment (if sat or sun, next business day) 11-May-16 Next Coupon Payment (if sat or sun, next business day) 11-May-17 Next Coupon Payment (if sat or sun, next business day) 11-May-18 Next Coupon Payment (if sat or sun, next business day) 11-May-19 Next Coupon Payment (if sat or sun, next business day)

11-May-20 Redemption & Last coupon payment (if sat or sun, next business day)

32

This page is intentionally left blank

LARSEN & TOUBRO LIMITED - Bombay Stock Exchange NCD I… · LARSEN & TOUBRO LIMITED (“L&T” or...

Documents

Transcript of LARSEN & TOUBRO LIMITED - Bombay Stock Exchange NCD I… · LARSEN & TOUBRO LIMITED (“L&T” or...