The unit of Larsen & Toubro will raise 12 billion rupees through 5-year bonds with a call option after the third and fourth years at 8.95 percent, the sources said.

Axis Bank and HDFC Bank are the arrangers to this tranche, with 6 billion rupees each, they said.

The shipbuilder will sell 13 billion in longer tenure 15-year bonds with 11- to 15-year separately tradable and redeemable principal parts (STRPP), and a call option after the 10th year at 9.10 percent.

Axis Bank is the sole arranger for this tranche.

The bonds are locally rated AAA (SO) on the back of a guarantee from parent Larsen & Toubro.