BSE and NSE Issue No-Objection Letters for L&T Realty Demerger Scheme, Clearing Path to NCLT Filing
Regulatory Milestone Reached in L&T Realty Restructuring
Larsen & Toubro Limited (L&T) has received observation letters from BSE Limited and the National Stock Exchange of India (NSE) concerning its proposed scheme of arrangement with L&T Realty Properties Limited (LRPL). Based on the draft scheme and documents submitted, NSE conveyed a "No Objection" under Regulation 37 of SEBI (LODR), enabling L&T to file the scheme with the NCLT. The observation letter is valid for six months from 19 March 2026.
Larsen & Toubro Limited (L&T) receives "No Objection" letters from BSE and NSE for its proposed scheme of arrangement with L&T Realty Properties Limited, following SEBI observations under Regulation 37 of SEBI LODR. The BSE issued its letter with "no adverse observation" on March 18, 2026, clearing a significant regulatory hurdle for the transaction.
Structure and Rationale of the Proposed Transfer
The scheme involves a slump sale of L&T's realty undertaking to LRPL, aimed at streamlining operations and creating synergies between the entities. The scheme proposes the transfer and vesting of L&T's Realty Undertaking into L&T Realty Properties on a going-concern slump-sale basis.
The boards of both companies approved the scheme on December 8, 2025. The appointed date for the scheme is April 1, 2026. Upon effectiveness, the Transferee Company will issue 393.54 crore fully paid-up equity shares to L&T at a nominal face value of ₹10 per share, with a premium of ₹6 per share.
The undertaking includes assets, liabilities, contracts, and employees pertaining to the realty business. According to L&T, the restructuring is intended to create a focused management structure for the realty business.
Next Steps Toward NCLT Approval
The observation letters from BSE and NSE represent clearance at the exchange level under the Securities and Exchange Board of India (SEBI) Listing Obligations and Disclosure Requirements (LODR). The observation letter is valid for six months from 19 March 2026. This six-month window provides L&T with the regulatory runway to file the scheme with the National Company Law Tribunal (NCLT).
The Mumbai Bench of the National Company Law Tribunal (NCLT) has allowed a first-motion application in the proposed demerger of Larsen & Toubro Ltd's (L&T) realty business into its wholly owned subsidiary, L&T Realty Properties Ltd. The tribunal also directed the convening of a meeting of L&T's equity shareholders to consider the scheme. This first motion order, issued recently, directed shareholders to vote on the proposal within the statutory timeframe.
Observations from SEBI/BSE/NSE must be incorporated in the petition filed with the National Company Law Tribunal (NCLT). The exchange observations also outline disclosure requirements and compliance conditions that must be adhered to during shareholder voting and subsequent NCLT proceedings.
Scope and Scale of L&T Realty Operations
Established in 2011, L&T Realty is the real estate arm of Larsen and Toubro and is currently present in Mumbai, Navi Mumbai, NCR, Bengaluru, Hyderabad and Chennai. Over the years, L&T Realty has delivered premium residential, commercial and mixed-use developments across India's most dynamic urban centres — Mumbai, Navi Mumbai, Bengaluru, NCR, Chennai and Hyderabad.
Today, L&T Realty is counted among India's leading developers with a substantial development potential of 65 million sq. ft., spanning upscale residential communities, Grade-A commercial spaces and high-street retail developments. Notably, it developed Seawoods, India's first landmark Transit-Oriented Development (TOD), which set new benchmarks for integrated, future-forward urban design.
Commenting on the development, Mr S N Subrahmanyan, Chairman & Managing Director, L&T, said: "L&T Realty needs to perform independently. It has to continuously expand its project pipeline through proactive land bank growth and joint developments." The proposed transfer is the first step in creating a consolidated powerhouse that can redefine the future of urban development in India. The integration of the Realty BU sets the foundation for L&T Realty to emerge as India's most admired and sought-after real estate brand in the next five years.