L&T Finance (LTF) Q2 24/25 earnings summary

Executive summary

• Q2 FY25 PAT reached ₹696 crore, up 17% year-over-year, with retail disbursements growing 12% YoY to ₹15,092 crore and the retail book expanding 28% YoY to ₹88,975 crore.

• Retailisation hit 96% of the overall book, and consolidated book rose 18% YoY to ₹93,015 crore.

• Transformation to a granular retail financial services provider continues, with a focus on customer acquisition, credit underwriting, digital architecture, and brand visibility.

• Consolidated net profit after tax for the six months ended September 30, 2024, was ₹1,381.93 crore, up from ₹1,124.74 crore year-over-year.

• NIMs improved to 8.94% (up 32 bps YoY); NIM plus fee stood at 10.86%, improving by 5 bps sequentially.

Financial highlights

• Interest income for Q2FY25 was ₹3,527 crore, up 15% YoY; NIM at ₹2,051 crore, up 19% YoY.

• Fee & other income at ₹440 crore; total income at ₹2,491 crore, up 15% YoY.

• Operating expenses at ₹958 crore, up 11% YoY; pre-provision operating profit at ₹1,534 crore, up 17% YoY.

• Book value per share at ₹97.4, up 9% YoY; net worth at ₹24,268 crore, up 9% YoY.

• Consolidated revenue from operations for the quarter ended September 30, 2024, was ₹4,019.34 crore, up from ₹3,482.07 crore year-over-year.

Outlook and guidance

• Lakshya 2026 goals on track: retailisation >95%, retail book CAGR >25%, GS3 <3%, NS3 <1%, and consolidated RoA of 2.8–3% by FY26.

• Q3 FY25 expected to be as challenging as Q2, with normalization anticipated in Q4 FY25.

• Cautious optimism for rural and urban demand recovery, supported by strong monsoon and government spending.

• Loan growth guidance remains at 25% as per Lakshya objectives, with risk-calibrated growth in non-rural segments.

• No specific forward-looking guidance was provided.