Larsen & Toubro, or L&T, has made a significant stride in sustainable finance by successfully raising Rs 500 crore through the listing of India’s first ESG bonds on the National Stock Exchange (NSE).
The company issued these non-convertible debentures (NCDs) at a competitive coupon rate of 6.35 percent.
As part of the sustainability-linked bond agreement, L&T has undertaken ambitious environmental commitments. These include measurable reductions in freshwater withdrawal intensity and greenhouse gas emissions, aligning with their long-term vision of achieving water neutrality by 2035 and carbon neutrality by 2040. These targets directly contribute to India’s national agenda for net-zero and climate-resilient growth.
This issuance underscores a growing investor appetite for ESG-compliant financial instruments in India and establishes a benchmark for future sustainable financing initiatives within the country’s financial markets.
The NCDs carry a three-year maturity period, with annual interest payments, and are set to mature on June 19, 2028. HSBC acted as the sole lead arranger for this pioneering transaction.
This landmark issuance falls under the Securities and Exchange Board of India’s (SEBI) introduced ESG and sustainability-linked bond framework, launched on June 5, 2025. This new framework aims to enhance transparency, accountability, and alignment with international ESG standards in India’s capital markets.
L&T’s successful venture sets a new precedent for a greener and more sustainable financial future in India. The company emphasizes its strong commitment to driving ESG goals and supporting broader energy transition objectives.
