Strategic Divestment: L&T Sells Nabha Power to Torrent Power

Executive Summary Larsen & Toubro Limited (L&T), through its subsidiary L&T Power Development Limited, has entered into a definitive Securities Purchase Agreement (SPA) to divest its 100% stake in Nabha Power Limited (NPL). The asset is being acquired by Torrent Power Limited for a total consideration of ₹3,660.9 crore. This transaction represents a key strategic realignment for both organizations, accelerating L&T’s asset monetization goals while enabling Torrent Power’s geographic expansion. Key Transaction Highlights Deal Structure: The transaction involves the complete transfer of 100% equity and all convertible instruments currently held by L&T in Nabha Power. Consideration: The acquisition is valued at ₹3,660.9 crore. Timeline to Close: The transaction is slated for completion on or before June 30, 2026. It remains subject to customary closing conditions and requisite regulatory approvals. Upon closure, NPL will officially cease to be a subsidiary of L&T. Financial Profile of Nabha Power (FY25) Nabha Power has been a stable contributor to L&T’s consolidated financials. As of the fiscal year ending March 31, 2025, NPL reported: Revenue Contribution: A turnover of ₹4,421.5 crore, which translates to 1.73% of L&T’s consolidated revenue. Net Worth: ₹3,553 crore, accounting for 3.64% of L&T’s consolidated net worth. Strategic Rationale Value-Driven Monetization for L&T: This divestment is a calculated move that perfectly aligns with L&T’s broader corporate strategy to exit capital-intensive development projects. By monetizing this asset, L&T optimizes its capital allocation, freeing up liquidity to strengthen its balance sheet and focus on its core, high-margin Engineering, Procurement, and Construction (EPC) and technology portfolios. Market Expansion for Torrent Power: For the acquirer, this ₹3,661 crore deal serves as a pivotal entry point into the lucrative North Indian power market.