L & T Fin Ncd

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  • PROSPECTUS

    August 13, 2009

    L&T FINANCE LIMITED Registered Office

    L&T House, Ballard Estate, Mumbai - 400 001 Tel: (022) 6752 5656 Fax: (022) 6752 5893

    Administrative Office

    The Metropolitan, 8th Floor, C-26/27, E-Block, Bandra-Kurla Complex, Bandra (E), Mumbai - 400 051

    Tel: (022) 6737 2951 Fax: (022) 6737 2900 Website: www.ltfinance.com

    Compliance Officer & Contact Person: Mr. S. Krishna Kumar E-mail: ncdissue09@ltfinance.com

    Public Issue by L&T Finance Limited (Company or Issuer) of 50,00,000 Secured Redeemable Non-

    Convertible Debentures (NCDs) of face value of Rs.1,000/- each aggregating to Rs.500 Crores with an option to

    retain over-subscription upto Rs.500 Crores for issuance of additional NCDs, aggregating upto a total of Rs.1,000

    Crores, hereinafter referred to as the Issue.

    GENERAL RISK

    Investors are advised to read the Risk Factors carefully before taking an investment decision in this Issue. For taking an investment

    decision, investors must rely on their own examination of the Issuer and the Issue including the risks involved. Specific attention of the

    investors is invited to the Risk Factors on pages 8 to 14 of this Prospectus.

    ISSUERS ABSOLUTE RESPONSIBILITY The Issuer, having made all reasonable inquiries, accepts responsibility for and confirms that this Prospectus contains all information

    with regard to the Issuer and the Issue, which is material in the context of the Issue, that the information contained in this Prospectus 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 makes this Prospectus as a whole or any of such

    information or the expression of any such opinions or intentions misleading in any material respect.

    CREDIT RATING The NCDs have been rated CARE AA+ by CARE and LAA+ by ICRA. Instruments with a rating of CARE AA+ by CARE are

    considered to offer high safety for timely servicing of debt obligations. Such instruments carry very low credit risk. The rating of LAA+ by ICRA indicates high-credit-quality and the rated instrument carries low credit risk. The ratings provided by ICRA and CARE may be

    suspended, withdrawn or revised at any time by the assigning rating agency on the basis of new information etc., and should be evaluated

    independently of any other rating. These ratings are not a recommendation to buy, sell or hold securities and investors should take their own decisions. Please refer to page 20 for the rationale for the above ratings.

    LISTING

    The NCDs offered through this Prospectus are proposed to be listed on the National Stock Exchange of India Limited (NSE). NSE vide letter Ref.: NSE/LIST/115117-7 dated August 7, 2009 has granted in-principle approval for listing of NCDs to be issued in pursuance of

    this Prospectus. NSE shall be the Designated Stock Exchange.

    LEAD MANAGERS TO THE ISSUE REGISTRAR TO THE ISSUE

    SBI Capital Markets Limited

    202, Maker Towers 'E', Cuffe

    Parade, Mumbai - 400005

    Tel: +91 22 2217 8300

    Fax: +91 22 2218 8322

    Email:

    ltfin.publicbonds@sbicaps.com

    Investor Grievance Email:

    investor.relations@sbicaps.com

    Website: www.sbicaps.com

    Contact Person: Mr. Nishit

    Mathur

    Compliance Officer: Mr.

    Bhaskar Chakraborty

    SEBI Registration No.:

    INM000003531

    JM Financial Consultants Private

    Limited

    141 Maker Chambers III, Nariman

    Point, Mumbai - 400021

    Tel: +91 22 3953 3030

    Fax: +91 22 2204 7185

    Email:

    LTFBondIssue@jmfinancial.in

    Investor Grievance Email:

    grievance.ibd@jmfinancial.in

    Website: www.jmfinancial.in

    Contact Person: Mr. Mayank Jain

    SEBI Registration No.:

    INM000010361

    Standard Chartered Bank

    90 M.G. Road, Fort, Mumbai -

    400001

    Tel: +91 22 22651304

    Fax: +91 22 22651255

    Email: ltfbonds@sc.com

    Investor Grievance Email:

    grievance.cmindia@sc.com

    Website:

    www.standardchartered.co.in

    Contact Person: Mr. Vivek

    Ramakrishnan

    Compliance Officer: Mr. Rajinder

    Chugh

    SEBI Registration No.:

    INM000010817 (application for

    renewal made on February 10, 2009)

    Sharepro Services (India) Private

    Limited

    Samhita Warehousing Complex, Bldg.

    No.13A B, Gala No.52 to 56, Near

    Sakinaka Telephone Exchange, Andheri

    - Kurla Road, Sakinaka, Mumbai -

    400072

    Tel: +91 22 67720300 / 67720400

    Fax: +91 22 28591568 / 28508927

    Email: sharepro@shareproservices.com

    Investor Grievance Email:

    ltfin@shareproservices.com

    Website: www.shareproservices.com

    Contact Person: Mr. Prakash Khare

    Compliance Officer: Mr. V. Kumaresan

    SEBI Registration No.: INR000001476

    ISSUE PROGRAMME

    ISSUE OPENS ON: AUGUST 18, 2009 ISSUE CLOSES ON: SEPTEMBER 4, 2009

    The subscription list for the public issue shall remain open for subscription at the commencement of banking hours and close at the close of

    banking hours on the dates indicated above or earlier on such date as may be decided at the discretion of the Board / Committee of Directors of the Company, as the case may be. In case of an earlier closure, the Company shall ensure that notice of atleast 3 days is given to the investors

    which shall be communicated through advertisements.

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    TABLE OF CONTENTS

    SECTION I : GENERAL..................................................................................................................................... 2

    DEFINITIONS & ABBREVIATIONS.............................................................................................................. 2

    FORWARD LOOKING STATEMENTS.......................................................................................................... 6

    PRESENTATION OF FINANCIALS & USE OF MARKET DATA ............................................................... 7

    SECTION II : RISK FACTORS......................................................................................................................... 8

    SECTION III: INTRODUCTION .................................................................................................................... 15

    GENERAL INFORMATION .......................................................................................................................... 15

    SUMMARY OF BUSINESS, STRENGTH & STRATEGY........................................................................... 22

    THE ISSUE...................................................................................................................................................... 23

    SUMMARY FINANCIAL INFORMATION.................................................................................................. 25

    CAPITAL STRUCTURE................................................................................................................................. 29

    OBJECTS OF THE ISSUE .............................................................................................................................. 35

    STATEMENT OF TAX BENEFITS ............................................................................................................... 36

    SECTION IV: ABOUT THE ISSUER AND THE INDUSTRY..................................................................... 38

    INDUSTRY...................................................................................................................................................... 38

    BUSINESS ..................................................................................................................................................... 47

    HISTORY AND MAIN OBJECTS.................................................................................................................. 57

    OUR MANAGEMENT.................................................................................................................................... 58

    OUR PROMOTERS ........................................................................................................................................ 65

    OUR SUBSIDIARY ........................................................................................................................................ 73

    SECTION V: FINANCIAL INFORMATION................................................................................................. 74

    AUDITORS REPORT .................................................................................................................................... 74

    DISCLOSURES ON EXISTING FINANCIAL INDEBTEDNESS .............................................................. 138

    MATERIAL DEVELOPMENTS................................................................................................................... 142

    SECTION VI : ISSUE RELATED INFORMATION ................................................................................... 143

    TERMS OF THE ISSUE................................................................................................................................ 143

    ISSUE STRUCTURE .................................................................................................................................... 146

    ISSUE PROCEDURE ..........................................................................................