L&T Finance Q2 PAT jumps 17% YoY to Rs 695 cr

L&T Finance reported 16.88% jump in consolidated net profit to Rs 695.58 crore in Q2 FY25 as compared with Rs 595.11 crore in Q2 FY24.

Total income increased 15.56% YoY to Rs 4,024.02 crore during the quarter.

Profit before tax (PBT) increased 17.83% to Rs 939.57 crore in Q2 FY25 as compared with Rs 797.39 crore in Q2 FY24.

Net interest income improved 15% year on year (YoY) to Rs 3,527 crore in the quarter ended 30 September 2024. Net interest margin plus fees & other income in Q2 FY25 was 10.86% as against 10.84% in Q2 FY24.

The companys retail book witnessed a strong growth of 28% YoY to Rs 88,975 crore while disbursements grew by 12% YoY to Rs 15,092 crore.

Rural business finance quarterly disbursements stood at Rs 5,435 crore in Q2 FY25, down 5% as compared with Rs 5,741 crore in Q2 FY24 while Book size increased 22% YoY to Rs 26,539 crore in Q2 FY25.

Farmer Finance disbursement jumped 16% YoY to Rs 1,782 crore in Q2 FY25. The book size stood at Rs 14,488 crore, up 9% YoY. Growth was aided by good monsoon, Kharif crop, and steady reservoir levels, stated by the company.

Two wheeler finance disbursement jumped 32% YoY to Rs 2,393 crore in Q2 FY25 as compared with RS 1,817 crore in Q2 FY24. Book size stood at Rs 12,669 crore in Q2 FY25, up 33% YoY.

Personal loans disbursements increased 4% YoY to Rs 1,361 crore during the quarter. Book size jumped 11% YoY to Rs 7,178 crore in Q2 FY25.

In Q2 FY25, Housing Loans & Loans against property (LAP) disbursement surged 46% to Rs 2,531 crore as compared with Rs 1,734 crore in Q2 FY24. The book size increased 42% YoY to Rs 21,731 crore during the quarter. The company said that growth was due to collaborative tie-up with prime developers across top locations.

SME Finance disbursement jumped 43% to Rs 1,244 crore during the quarter as compared with Rs 872 crore in Q2 FY24. The book size surged 115% to Rs 5,190 crore in Q2 FY25 as compared with Rs 2,413 crore in same quarter last year.

Sudipta Roy, managing director & CEO, LTF said, The company has been able to demonstrate sustainable growth and profits through proactive portfolio management and persistent collection strategies. The second quarter of the current financial year has been challenging on account of multiple sectoral headwinds and a volatile macro environment

Looking ahead, we expect that the sectoral challenges may persist for the next two quarters and apropos to the same, we may dynamically recalibrate our business objectives in the coming quarters, prioritizing positive credit outcome over assets under management growth.

Our next gen credit underwriting engine, Project Cyclops, which was operationalized in the quarter ended September 30, 2024 in our two-wheeler finance product is expected to be leveraged for our other major products through the course of second half of the current fiscal. We expect this to be a strategic differentiator in the financial services ecosystem. Digitally-enabled acquisition engines would be scaled up through big-tech partnerships to ensure low-cost acquisition while maintaining superior credit quality.

L&T Finance offers financing for two-wheelers, consumer goods, homes, farm equipment, women entrepreneurs, rural groups, real estate, and infrastructure. It provides financing for small and medium enterprises through term loans and overdraft facilities.

The counter rose 0.27% to end at Rs 166.65 on Friday, 18 October 2024.

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