Lloyds Engineering Works Ltd announces an acquisition

The Scheme, based on the share-exchange-ratio report dated 29 December 2025 issued by Bansi S. Mehta Valuers LLP, provides for the following consideration: ^[1]

Impact on the post-merger equity base: LEWL’s equity share capital will increase through the shares issued to LICL and MHPL shareholders, while there will be no issuance for TIPL. Shares held by LEWL in the transferor companies are not entitled to consideration and are cancelled. The Scheme therefore creates selective dilution for existing LEWL shareholders, limited to the shares issued under the LICL and MHPL ratios.

The precise post-merger number of LEWL shares cannot be calculated from the cited disclosure because the total number of eligible LICL shares and MHPL shares held by shareholders other than LEWL is not provided. The MHPL allotment example shows that 6,90,000 MHPL shares held by Mr. Manan Agrawal would result in 1,29,72,000 new LEWL shares, while LEWL’s own 21,85,000 MHPL shares would receive no shares. ^[4]

The three target entities would contribute Rs 2,261.35 Crores of revenue and Rs 336.17 Crores of EBITDA in FY2025-26. On a simple pro forma addition to LEWL’s FY2025-26 financials, this represents approximately 68.25% of combined revenue and 64.12% of combined EBITDA.

FY2025-26 contribution

Notes: † EBITDA margin = EBITDA / revenue. ‡ Derived from the reported entity-level figures; the Scheme does not provide a post-merger audited consolidated statement in the cited financial tables. Inter-company eliminations and merger-accounting adjustments are therefore not reflected.

LICL is the economic driver. It contributes around 84% of target revenue and 83% of target EBITDA, while also bringing an order book of over Rs 4,500 Crores and project-execution capabilities to the merged entity. ^[6]

Alignment with the merger rationale

The financial contribution is broadly consistent with the stated rationale:

• Scale: The targets, led by LICL, would more than double LEWL’s FY2025-26 revenue base on a simple additive basis and contribute the majority of the illustrative combined entity’s revenue and EBITDA.
• Business complementarity: LEWL operates in process-plant equipment and engineering, while LICL operates in roads, bridges, railways, civil infrastructure and related construction; MHPL adds heavy fabrication capabilities, and TIPL operates in elevators, escalators, motors and pumps. ^[7]
• Larger-contract capability: The Scheme specifically links the combination of LICL’s order book and execution capability with LEWL’s manufacturing and engineering capabilities to pursue larger, multidisciplinary contracts. ^[6]
• Operating and financial synergies: The stated benefits include centralized management, elimination of duplicated functions, resource optimization, lower administrative and compliance costs, a stronger asset base and improved borrowing capability. ^[8]

Analyst interpretation: the numbers support the merger’s scale and revenue-pool rationale, but the quantified contribution is not evenly distributed across the three targets. LICL provides most of the incremental economic weight; MHPL and TIPL are more relevant as capability and product-line additions than as major contributors to the combined revenue pool. Also, the revenue and EBITDA arithmetic demonstrates contribution, not necessarily realized synergy: the Scheme does not quantify the post-merger cost savings, inter-company eliminations or incremental EBITDA expected from integration.

The merger is not yet final. Beyond the NCLT-convened unsecured-creditor meeting, the explicitly identified remaining requirements are:

• Shareholder and creditor approvals of the companies involved, as required under the scheme process. The exchange NOCs specifically state that the scheme remains subject to these approvals and the sanction of the jurisdictional NCLT. ^[9]
• NCLT sanction of the scheme after the meetings and submission of the required material. The NSE and BSE observation letters are valid for six months from their respective issue dates, within which the company must submit the scheme to the NCLT. ^[9]
• Compliance with exchange observations and disclosures, including disclosure of transfer of all transferor-company liabilities, pending adjudication or recovery proceedings involving the companies, promoters or directors, the scheme’s revenue impact and rationale, and the valuation report in the explanatory statement. The company must also file a compliance-status report with the exchanges. ^[9]
• Competition Commission of India approval has been received, so this is not an outstanding approval based on the latest reported update. ^[10]
• NSE and BSE no-objection certificates have also been received—NSE on 18 May 2026 and BSE on 19 May 2026 under SEBI Listing Regulations—subject to compliance with their observations and other applicable laws. ^[9]

Timeline: Management’s projected effective date of amalgamation is not stated in the cited material. The only hard timetable disclosed is procedural: submission of the scheme to the NCLT within the six-month validity period of the exchange observation letters—effectively by mid-November 2026, measured from the 18–19 May 2026 letters. ^[9] This is a filing deadline, not a management forecast for the effective date. The effective date therefore remains contingent on completion of the meetings, NCLT sanction and subsequent implementation steps.