L&T Finance Ltd share Price Today

L&T Finance Holding (LTFH) is a leading NBFC catering to the diverse financing needs of served and underserved customers in urban as well as rural areas. LTFH offers financial assistance in various segments including consumer loans, two-wheeler loans, home loans, micro loans, farm loans and SME loans. Backed by a strong parent, the lender has been assigned “AAA” rating by rating agencies. Its distribution network remains strong with substantial dealer penetration (2500+ dealers in farm equipment and 5500+ tie-ups in two-wheeler segment), 2 crore customers (database) spread across 21 states and one union territory.

In April 2022, LTFH announced “Lakshya 2026”, which was targeted towards retailisation and a shift from product based approach to customer focused approach to pedal business growth as well as improve return ratios. As per the plan, the recalibrated product growth strategy was adopted with customised products in mature markets [farm equipment, rural group loans (MFI) and two wheeler finance] with focus on newer retail segment (consumer loans, home loans, LAP and SME loans) with substantial growth potential.

The management aimed to run down the wholesale book and increase retail share in total loans. Accordingly, in the last four quarters, the share of retail loans has increased from 51% to 75% while the proportion of wholesale book has declined from 49% to 25% (from ₹ 43257 crore to ₹ 19840 crore). Induction of new Chairman SN Subrahmanyan in February 2022 hastened the process of restructuring further.

Going ahead, AUM growth is expected to be driven by the retail segment – newer segments seen driving faster traction while existing mature segments are expected to witness steady growth with a gradual gain in market share. Increase in retail proportion will continue to aid NIMs trajectory (calculated NIMs at 7.5% in FY23 vs. 6.3% in FY22), which is expected to improve to ~8-9% levels.

LTFH has been focusing on accelerating retailisation and, thus, leveraging fintech capabilities through automation in order to make the customer journey hassle free and quick. All this should aid sustainable retail AUM growth (31% YoY in FY24E and 24% YoY in FY25E) and gradual improvement in efficiency. However, CI ratio could remain elevated at ~40-41% in the initial phase and subsequently witness improvement at ~38-39% level.

Holding company L&T Finance announced Q4FY24 & FY24 results:

Q4FY24 Consolidated Financial Highlights:

• Profit After Tax (PAT) reached Rs 554 crore, up 11% YoY from Rs 501 crore.
• Net Interest Income (NII) amounted to Rs 1,909 crore, showing a 14% YoY increase from Rs 1,679 crore.
• Net Interest Margin Fees & Other Income stood at 11.25%, up 204 basis points (bps) YoY from 9.21%.
• Retail Disbursements totaled Rs 15,044 crore, reflecting a 33% YoY increase from Rs 11,282 crore.
• Return on Assets (RoA) stood at 2.19%, up 29 bps YoY from 1.90%.
• Return on Equity (RoE) stood at 9.53%, up 16 bps YoY from 9.37%.

FY24 Consolidated Financial Highlights:

• Profit After Tax (PAT) amounted to Rs 2,320 crore, up 43% YoY from Rs 1,623 crore.
• Net Interest Income (NII) reached Rs 7,115 crore, marking a 12% YoY increase from Rs 6,368 crore.
• Net Interest Margin Fees & Other Income stood at 10.67%, up 200 bps YoY from 8.67%.
• Retail Disbursements totaled Rs 54,267 crore, reflecting a 29% YoY increase from Rs 42,065 crore.
• Retail Book amounted to Rs 80,037 crore, up 31% YoY from Rs 61,053 crore.
• Return on Assets (RoA) stood at 2.32%, up 79 bps YoY from 1.53%.
• Return on Equity (RoE) stood at 10.35%, up 256 bps YoY from 7.79%.

Commenting on the financial results, Sudipta Roy, Managing Director & CEO, L&T Finance said, “In the second year of our Lakshya 2026 strategic plan, we are happy to report a retailisation of 94% surpassing our goals well ahead of schedule. Our Net Profit for FY24 saw a healthy 43% YoY growth to Rs. 2,320 Crore, driven by a 31% YoY increase in our retail book and a 29% YoY rise in disbursements. This is the highest ever yearly PAT the Company has delivered during its lifetime. Despite the challenging interest rate environment, our borrowing cost remained stable and our portfolio credit metrics continued its improvement journey. Looking ahead, our focus remains on exceeding the 95% retailisation target while maintaining a robust book growth of more than 25%. Our commitment to operational excellence, customer centricity, strong governance and risk management, coupled with a digital first approach, will sustain our growth momentum towards building a value creating, customerfocused technology first financial services powerhouse.”

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