L&T Finance share price soars 45% so far in 2025; what's behind the rally?

LTF stock price hit an over seven-year high of ₹197.10, and was trading higher for the fifth straight day, surging 14% during this period.

L&T Finance share price today

 

Shares of L&T Finance (LTF) hit an over seven-year high at ₹197.10, up 2 per cent on the BSE in Tuesday’s intra-day trade on the back of a healthy business outlook. The stock price of this non-banking finance company (NBFC) quoted at its highest level since November 2017. The stock was inching towards its record high of ₹213.60 touched on October 24, 2017, the BSE data shows. 

 

LTF was trading higher for the fifth straight day, surging 14 per cent during the period. In comparison, the BSE Sensex was up 2 per cent during the same period. Thus far in the calendar year 2025, the stock has rallied 45 per cent, as against 5 per cent rise in the benchmark index.  Catch Stock Market Latest Updates Today LIVE 

What’s driving L&T Finance share price?

 

Shares of banking, financial services, and insurance (BFSI) sector post Reserve Bank of India (RBI) meeting have been in limelight; as reversal in interest rate cycle to boost credit off-take, thereby easing of liquidity to aid margin trend which will support return ratios. 

 

While prudently balancing fiscal consolidation and growth objectives, the Union Budget for FY26 has announced several measures under four engines of growth – agriculture, MSMEs, investment and exports. The tax cuts on individuals as announced in the Union Budget for FY26 are set to increase disposable income, boosting consumer spending and improving their loan eligibility which is expected to drive demand for credit.  ALSO READ | RBI cuts repo, CRR: 5 rate sensitive stocks to buy with up to 26% upside

 

Furthermore, RBI’s commitment to maintain sufficient systemic liquidity could expedite transmission of policy rate cuts and help the NBFC sector to reduce their overall cost of funds, LTF said in its FY25 annual report.

 

LTF is amongst the leading financial institutions offering Farmer Finance, Rural Business Finance, Two-wheeler Finance, Personal Loans, Home Loans & Loan Against Property (LAP), and Business Loans. 

 

In FY25, the retail book witnessed a strong growth of 19 per cent year-on-year (YoY) to close at ₹ 95,180 crore and disbursements grew by 11 per cent YoY to ₹ 60,040 crore. Both these factors led to improved retailisation of the total lending book to 97 per cent, LTF said.  ALSO READ | Protean eGov share price zooms 6% on securing this deal; key details here

 

Meanwhile, LTF has entered into Business Transfer Agreement with Paul Merchants Finance Pvt. Ltd. for the proposed acquisition of their gold loan business undertaking by way of a slump sale on a going concern basis. The acquisition is in line with the company’s strategy to enhance secured high yielding book. It cuts time-to-scale gold loan business by 36 months, providing a high quality, profitable attractive RoA profile gold loan franchise at an attractive consideration. Integration plan and governance framework put in place to achieve a targeted closing date within Q2FY26, LTF said.

 

Brokerages view on L&T Finance

 

Analysts at JM Financial Institutional Securities believe that a meaningful re-rating of the stock will depend on a) successful execution of the strategy to shift towards prime and near-prime customers while maintaining returns, b) realization of operating leverage through strategic technology investments, and c) effective management of credit costs, particularly through the rollout of proprietary AI-ML underwriting across all segments.

 

Looking ahead, with the successful implementation of Project Cyclops, a comprehensive credit administration framework overhaul, and the introduction of Project Nostradamus, LTF is poised to boost disbursement in FY26, particularly in its urban and rural businesses, according to analysts at Geojit Financial Services. 

 

Continued investments in digital transformation initiatives are also expected to support growth. Additionally, significant partnerships for various products are expected to fuel sustainable retail loan growth, the brokerage firm said.  ALSO READ | United Spirits shares rise on buzz of Diageo stake sale in RCB franchise

 

About L&T Finance Ltd (LTF)

 

L&T Finance formerly known as L&T Finance Holdings is a leading Non-Banking Financial Company (NBFC), offering a range of financial products and services. The company is focused on creating a top-class, digitally enabled, Retail finance company as part of the Lakshya 2026 plan.