Engineering and construction major — Larsen & Toubro (L&T) Executive Chairman A M Naik, on Monday, proposed to launch forex bonds up to US$1 billion in phases for integrated infrastructure finance.
Mr Naik made this announcement at the launch function of L&T Infotech’s new state-of-the-art 1900-seat software development centre at Mahape on the outskirts of Mumbai. 
L&T Chief Financial Officer Y M Deosthalee, however, clarified later after the press conference that the company has only made a decision to tap the market overseas and it is still a long way to happen.
For one, Mr Deosthalee explained, that L&T is still to obtain regulatory clearances for this purpose and secondly, it plans to raise the funds in phases. “We have plans to raise US$500 million in the first phase and subsequently it will raise some more and together it will be about US$1 billion in all.” 
Essentially, he added, this fund will seek to do the job of an anchor-investment for an infrastructure project, in which majority of finance will come from other investors both within and outside the country. “Apart from the anchor investment, our domain knowledge will be the key differentiator to that infrastructure project,” Mr Deosthalee added. Further, Mr Naik said L&T as a group – with its 96 companies under its command — is aiming for revenue of US$8 billion by 2010 and $15 billion by 2015. The company’s software division is expected to report a revenue of $400 million in the current fiscal that started April 1, 2007 is aiming for $1billion in revenue by 2010.

More acquisitions
“We are also planning few acquisitions to accelerate the growth of L&T Infotech,” Mr Naik said launching the company’s new brand identity for L&T Infotech.  L&T Infotech’s new software development centre (Block II) is located on a 5-acre plot adjacent to its existing software development centre (Block I)) at Mahape and entailed an investment of Rs 60 crore.  More such centres will come up in Mumbai (another one at Powai), Bangalore and twin tower in Chennai by March 2008.
The company is currently implementing a 5-year strategic plan, under which it would ramp its work force from the existing 7,200 to 20,000 by March 2010.  Replying to a question, Mr Naik said the capital expenditure would be of order of Rs 800 crore over the next 3-4 years and focus on selected verticals such as banking & financial services, insurance, manufacturing and product engineering services (communications and embedded systems).
Mr Deosthalee said the Group has already raised US$100 million during the current fiscal from overseas markets and it will raise another US$150 million before current fiscal ends.  In effect, he continued, the group will keep those funds ready and look for growth opportunity.
L&T Infotech Chief Executive V K Magapu pointed out that the company has achieved 50 per cent growth year on year for the last four year and the trend will continue. It provides a wide spectrum of technology and integrated engineering services to a loyal client base that includes Chevron, Motorola, Freescale, Sanyo, Hitachi and several other leading global players.