Larsen & Toubro has announced a groundbreaking strategic partnership with NVIDIA to build India's largest gigawatt-scale AI factory under the India AI Mission. The venture aims to establish sovereign, scalable AI infrastructure that will reinforce India's position as a global AI powerhouse, serving both domestic and international requirements.

Strategic Partnership Details

The partnership integrates L&T's engineering, infrastructure development, and execution capabilities with NVIDIA's comprehensive AI infrastructure. This includes NVIDIA GPUs, CPUs, networking solutions, NVIDIA-accelerated storage platforms from leading providers, the NVIDIA AI Enterprise software stack, and reference architectures designed to enable rapid and secure AI adoption.

Infrastructure Development and Capacity

The venture will deploy AI-ready datacenter infrastructure and advanced computing platforms to support large-scale AI workloads across priority sectors. The partnership plans to scale NVIDIA GPU cluster deployment significantly across two key locations.

Market Applications and Services

The AI factory model is designed to deliver advanced AI services to multiple stakeholders including global off takers, hyperscalers, and Indian enterprises. The infrastructure will support various sectors in moving from experimentation to production-scale deployment.

Target Sectors:

• Manufacturing
• Infrastructure
• Energy
• Financial services
• Healthcare
• Public services

The venture will provide standardized, enterprise-grade AI capabilities, enabling predictable performance, security, and time-to-value for industrial and services use cases.

Leadership Perspectives

Mr. S. N. Subrahmanyam, Chairman & Managing Director L&T, emphasized the readiness of Indian enterprises to transition from AI pilots to production-scale deployment. He highlighted that the investment establishes the secure, scalable, and sovereign infrastructure foundation required to power various sectors and deliver measurable economic impact through AI.

Mr. Jensen Huang, Founder and CEO of NVIDIA, described AI as driving the largest infrastructure buildout in human history. He praised Prime Minister Modi's vision to democratize AI access across the Global South and position India as a global hub for digital infrastructure, noting L&T's 88-year legacy as an engineering and nation-building leader.

Innovation and Internal Applications

The partnership will enable L&T and its group companies to deploy live AI agents on Sovereign Cloud, fostering a self-sustaining innovation hub. This includes LTTS's Lights-Out Factory framework leveraging NVIDIA Omniverse libraries, LTM's Blueverse, LTFS's agentic AI deployment, and L&T's internally developed AI agents.

Strategic Vision

The venture aligns with the India AI Mission's vision of "Making AI in India and Making AI Work for India." The infrastructure is designed to be sovereign by design, optimized for accelerated computing, and ready to serve both global and domestic AI demand at national scale. This initiative represents a significant step toward establishing India as a strategic AI hub with interoperability to global ecosystems while maintaining data sovereignty.

Larsen & Toubro has executed a Securities Purchase Agreement to divest its wholly owned subsidiary Nabha Power Limited (NPL) to Torrent Power Limited for ₹3,660.87 crores. The transaction, announced on February 16, 2026, involves the sale of 100% equity and convertible instruments held by L&T Power Development Limited (L&T PDL) in NPL.

Transaction Structure and Timeline

The divestment involves multiple entities within the L&T group. L&T PDL, a wholly owned subsidiary of Larsen & Toubro, currently holds 100% stake in NPL. Upon completion of the transaction, NPL will cease to be a wholly owned subsidiary of L&T.

The closing of the transaction is subject to fulfillment of closing conditions as agreed in the Securities Purchase Agreement and requisite regulatory approvals.

Financial Impact and Contribution

Nabha Power Limited's financial contribution to L&T's consolidated operations demonstrates its significance within the group's portfolio. As of March 31, 2025, NPL's financial metrics showed substantial contribution to the parent company's overall performance.

About Nabha Power Limited

NPL owns and operates a 1,400 MW (2 X 700 MW) supercritical coal-fired thermal power plant located at Rajpura in Patiala district, Punjab. The facility was commissioned in 2014 under Case II Competitive Bidding Guidelines of Government of India and operates under a 25-year Power Purchase Agreement.

The power plant has demonstrated exceptional operational performance:

• Highest-ever Plant Availability Factor (PAF) of 95.36% in FY25
• Plant Load Factor (PLF) of 94.33% in July 2024
• Ranked 2nd among all thermal power plants (>500 MW) in India

The facility operates with long-term Fuel Supply Agreements with SECL and NCL for 2.775 million MT and 2.464 million MT respectively, along with mechanisms for alternate coal procurement. The plant's equipment is designed to blend domestic and imported coal, providing operational and fuel flexibility.

Strategic Rationale and Management Commentary

The divestment represents a value-driven monetization exercise, leveraging NPL's long-term power purchase agreement and stable operating performance. The transaction aligns with L&T's broader strategy to exit the development projects business.

S N Subrahmanyam, Chairman & Managing Director of L&T, commented that the divestment aligns with L&T's strategic objective of unlocking value to strengthen robust core businesses, positioning the company to create long-term value for all stakeholders.

Samir Mehta, Chairman of Torrent Power Ltd, stated that the acquisition marks Torrent's entry into the high-growth power market of northern India. He emphasized that NPL will add a high-quality, well-established operating asset supported by fully contracted cash flows and a strong operational track record.

Buyer Profile

Torrent Power Limited is an integrated power utility and one of the largest private sector players in India. The company has interests in power generation, transmission, distribution, and manufacturing and supply of power cables, with its registered office in Ahmedabad, Gujarat. Torrent does not form part of the Promoter Group or Group Companies of L&T, and the transaction does not fall within related party transactions.