Larsen & Toubro’s Green Move: ₹5 Billion ESG Bonds Debut on NSE

Larsen & Toubro Lists ₹5 Billion ESG Bonds on NSE, Marking a Milestone in Sustainable Finance

Larsen & Toubro (L&T) has made headlines by listing ₹5 billion worth of ESG (Environmental, Social, and Governance) bonds on the National Stock Exchange, becoming the first Indian corporation to do so under SEBI’s newly introduced ESG bond framework. This move signals a major step forward for sustainable finance in India’s corporate sector.

 

Key Highlights:

 

L&T’s ESG bond issue raised ₹5 billion (about $58 million) through three-year notes, carrying a 6.35% coupon rate—lower than the company’s comparable bonds in the secondary market, reflecting strong investor demand.

 

The bonds are compliant with SEBI’s new ESG and sustainability-linked bond regulations, which require clear sustainability objectives, third-party assessments, and post-issuance impact reporting.

 

Proceeds from the bond will support L&T’s environmental goals, including reducing fresh water withdrawal intensity and lowering greenhouse gas emissions. These targets align with the company’s ambitions to achieve water neutrality by 2035 and carbon neutrality by 2040.

 

The bonds received a AAA rating from Crisil and attracted significant interest from banks and mutual funds, with SBI Mutual Fund emerging as a principal investor.

 

HSBC India acted as the sole arranger for the deal, which sets a precedent for other Indian corporates interested in sustainable finance.

 

L&T’s management called the issuance a proud moment, reinforcing the company’s commitment to responsible business and sustainable development.

 

Following the positive response, L&T is considering further ESG bond issues, depending on market conditions and future funding needs.

 

Source: Reuters, HDFC Sky, TradingView, Business Today, Larsen & Toubro Press Release, Finimize