L&T Technology Services, the engineering research and development unit of Larsen & Toubro Ltd (L&T), has received Securities Exchange Board of India (SEBI)’s approval for its public issue.
A PTI report said SEBI approved the IPO on August 24. The company may raise up to Rs 1,000 crore, the report said.
In a stock exchange filing last month, L&T—India’s largest engineering and construction firm—said the proposed IPO of L&T Technology will be an offer for sale of 10.4 million shares. The company had filed its DRHP with the regulator in July.
L&T plans to sell a 15% stake in the unit through the offering, it said in the filing.
L&T Technology will be the fourth group firm to list on stock exchanges. Parent L&T has been a public firm for decades while the group's financial services arm, L&T Finance Holdings Ltd, floated its IPO five years ago.
In July, another Larsen unit, L&T Infotech Ltd floated its IPO. The public issue of the software services unit was covered more than 11 times, indicating strong investor interest.
L&T Technology offers R&D solutions for industries such as industrial products, transportation, aerospace and telecom. It also offers services in areas such as mechanical engineering, embedded systems, besides proprietary solutions in engineering data analytics, and the Internet of Things (IoT).
The company was set up in January 2014 by carving out the product engineering services segment from L&T Infotech. The integrated engineering business from L&T was then transferred to the new entity in April 2014, as per the exchange filing.
L&T Technology reported Rs 2,894 crore revenues for the financial year ended 31 March 2016, up 13% from Rs 2,560 crore a year before.
The issue will be managed by JM Financial, Kotak Investment Bank and Bank of America Merrill Lynch.
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