Larsen & Toubro Limited (L&T) has received ‘Observation Letters’ from both the BSE Limited and the National Stock Exchange of India for its proposed Scheme of Arrangement involving L&T Realty Properties Limited (LTRPL). The scheme, which involves L&T as the Transferor Company, is now proceeding to the next regulatory stage. The observation letters, dated March 18 and March 19, 2026, confirm no adverse observations concerning listing compliance requirements, enabling L&T to file the scheme with the Hon’ble NCLT.
Stock Exchanges Issue Observations on Scheme of Arrangement
Larsen & Toubro Limited announced that it has successfully received Observation Letters from the Bombay Stock Exchange (BSE) and the National Stock Exchange of India (NSE) regarding the proposed Scheme of Arrangement. This scheme involves the transfer of assets and liabilities between Larsen & Toubro Limited, acting as the Transferor Company (L&T), and L&T Realty Properties Limited, acting as the Transferee Company (LTRPL).
The letters, issued on March 18, 2026 (BSE) and March 19, 2026 (NSE), confirm that the stock exchanges have no adverse observations concerning the listing and disclosure requirements associated with the arrangement. This critical clearance allows the company to move forward with filing the requisite documentation with the Hon’ble National Company Law Tribunal (NCLT).
Key Conditions and Disclosures Required by Exchanges
Both exchanges mandated several conditions that L&T must adhere to while seeking shareholder and creditor approval:
- The entities must confirm full compliance with all provisions related to the scheme, particularly those concerning disclosure requirements and timelines.
- Disclosure of all ongoing adjudication, recovery proceedings, or enforcement actions against the listed entity, its promoters, or directors must be made to the NCLT and shareholders.
- Any additional information submitted after the initial filing must be promptly displayed on the websites of both the listed company and the stock exchanges.
- Financials considered for the valuation report must not be older than 6 months from the date of the No-Objection Certificate (NOC).
- Any proposed equity shares issued under the scheme must mandatorily be in demat form only.
- The observations from SEBI and the stock exchanges must be incorporated into the petition filed before the NCLT.
Mandatory Disclosures for Shareholders
L&T is specifically advised to ensure that the explanatory statement accompanying the resolution for shareholder approval (under Sections 230 to 232 of the Companies Act, 2013) includes comprehensive details to facilitate an informed decision:
- Rationale for the slump sale of the realty undertaking, expected synergies, and the cost-benefit analysis of the scheme.
- Detailed information regarding the Registered Valuer, the Valuation Report, and the Merchant Banker’s Fairness opinion, including the rationale for valuation methods used.
- Latest financials of LNTL and LRPL, not older than 6 months from the date of the NOC, must be updated on the website and included in the statement.
- Detailed pre- and post-scheme shareholding patterns, revenues, PAT, and EBIDTA for the last 3 years for both entities.
- Disclosure of the impact on reserves of both LNTL and LRPL resulting from the arrangement, including compliance with applicable accounting standards.
Validity and Next Steps
The Observation Letter from the NSE is valid for six months from March 19, 2026, within which the scheme must be submitted to the NCLT. The company has confirmed that copies of the observation letters are enclosed with this intimation and that this announcement is available on the investor relations website.
Source: BSE
