The Tata Group is reportedly eyeing Duetche Telekom's IT unit, T-Systems, reports CNBC-TV18.

A Dow Jones report says the Tatas are doing due diligence on T-Systems. Reports suggest that Tatas may cut the deal through the European arm of Tata Consultancy Services.

T-systems reported revenues of €12.5 billion last year. If this deal goes through, it could be one of India's largest. When contacted, Tata officials dismissed the possibility of the deal as speculation.

Deutsche Telekom spokesperson said when contacted that the company was looking for a strategic partner but stayed mum on who the company was talking to. He also said it was not looking at a complete sellout.