Exposure to crisis-hit IL&FS takes a toll on L&T Finance Holdings' stock

Company management though believes default probability is low, and overall liquidity levels are satisfactory

Nowadays, any association with defaulting companies is taken seriously by investors. Not surprising then, its exposure to step-down subsidiaries of IL&FS group and SuperTech pulled down L&T Finance Holdings’ (LTFH’s) stock by 7.6 per cent on Thursday, even as the company posted strong September-2018 quarter (Q2) numbers a day earlier post market hours.

For Q2, LTFH clocked 24 per cent year-on-year growth in loan book to Rs 912 billion and its net profit surged 66 per cent to Rs 5.6 billion. But, it’s Rs 18 billion exposure to SPVs of IL&FS Transportation Networks (IL&FS’ subsidiary) and Rs 8 billion