L&T Finance IPO: Review Analysis & Details of Larsen and Toubro Finance IPO

Another IPO is set to hit the primary stock markets very soon. The news has come out about the financial arm of Larsen and Toubro or L&T called L&T Finance, which is expected to come out with its IPO in the next month of January 2011. L&T Finance arm has decided to come out with the Initial Public Offering or IPO.
In this article, we will look at the Review, Analysis and Details of the L&T Finance IPO and try to do the Review and analysis of L&T Finance IPO.

L&T Finance IPO: Review Analysis & Details

Some basic details first about the L&T Finance IPO, which are available as of now:

- The size of L&T Finance IPO is Rs 1,245 Crore, and the reports are that the dilution for L&T Finance IPO will be around 15-17%

What are the primary reasons for L&T to come out with the L&T Finance IPO?
The main reason for any company to come and list its shares in the stock market is to collect money from common public and so is the case with L&T Finance IPO
However, the most important thing to note is that L&T Finance is already operational - L&T Finance is one of the leading NBFCs in the country and offers a wide spectrum of financial products and services for trade, industry and agriculture.
What you are going to see through this IPO is that this financial arm of L&T will be listed as a seperate entity on the stock exchanges.

So what is the needs of L&T to come out with the L&T Finance IPO?
The aim of L&T Finance is to get a banking licence to start banking operations in India.
As the Indian market opens up for more private players and organizations in the retail banking space, the requirements for obtaining a banking licence will be available by March 2011. L&T Finance has already restructured itself so as to become a potential candidate to apply for the banking licence. This L&T Finance IPO is being seen as an attempt by the management to get the required capital to fulfilling the needs of starting the banking operations.
There is also news that the money collected through this IPO will be passed on to the five subsidiaries-- L&T Infrastructure Company, L&T Finance, India Infrastructure Developers, L&T Investment Management and L&T Mutual Fund Trustees
What is the issue size of the L&T Finance IPO?
The L&T Finance IPO size is Rs 1245 Crores

What is the price band of L&T Finance IPO?
It is reported that the recommended price band for L&T Finance IPO is Rs. 51 to Rs 59 per share. Final price to be decided by the 100% book building process

How many shares will be sold in the L&T Finance IPO?
The total no. of shares to be sold through this IPO is not known precisely. However, it is known that there will be 15-17% stake dilution .

What are the IPO dates for L&T Finance IPO
The IPO dates for L&T Finance IPO are July 27 to July 29, 2011

How will the capital raised by L&T Finance IPO be used?
Growth is the buzzword, and the capital collected will be distributed to the five subsidiaries of the company as mentioned above. They need money and capital infusion for fuelling growth.

Any ratings given to L&T Finance IPO?
No information about that as of now.

What are the analysts recommendations and business results for L&T Finance IPO?
The company is in business since 1950 - L&T in itself is a good reputed name in India. Analysts are expecting a good response to the IPO and even in this lacklusture period where there is huge volatility in the stock market with a negative bias, experts believe that investors should apply for this L&T Finance IPO.