BackL&T may list its IDPL assets in Singapore
The engineering and construction firm is considering listing Infrastructure Development Projects and some road assets in the city-state
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Mumbai: Larsen and Toubro Ltd (L&T), India’s largest engineering and construction company, on Friday said it is considering an initial public offering (IPO) in Singapore for its subsidiary L&T Infrastructure Development Projects Ltd (L&T IDPL) as well as listing certain road assets of the unit through a business trust in Singapore.
“The proposed transactions are subject to various factors, including approvals and market conditions, and may or may not be completed," the company said in a filing to BSE.
L&T IDPL is engaged in public-private partnership projects in India with business interests spread across sectors involving roads and bridges, ports, metro rail, wind energy and power transmission lines.
Unlisted Indian companies are allowed to list on the overseas markets without having to be publicly traded on domestic exchanges, the government said in September, in a move expected to help firms raise capital abroad and support the rupee.
Money raised abroad may be used for retiring foreign debt or for overseas operations including acquisitions, the finance ministry said in a statement. However, if the funds raised are not used abroad, they will have to be remitted to India within 15 days and parked in banks.
L&T’s road unit company runs 13 expressways and has five more under construction.
Infrastructure Leasing and Financing Services Ltd, too, is planning to sell shares in Singapore. It plans to bring all wind energy assets under one company and sell its units in Singapore, a person familiar with the development said, asking not to be identified.
In October, Mint reported that Indian companies, especially those operating in the infrastructure space, had begun selling assets to pare their debt, a fall-out of rising interest costs and decreasing margins in a sluggish economy that has taken a toll on growth.
Since January, at least 10 Indian companies have either sold or announced the sale of assets in a bid to pare ₹ 3.58 trillion worth of debt, according to Mint research and an August report by Credit Suisse Securities Research and Analytics.
L&T ended Friday nearly 2% higher at ₹ 1,043.35 a share on BSE, outpacing the Sensex’s 1.25% rise to 20,791.93 points.
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