L&T Finance (LTF) Q3 24/25 earnings summary

Executive summary

• Achieved highest-ever Q3 retail disbursements of ₹15,210 crore, up 5% year-on-year, with retail book growing 23% year-on-year to ₹92,224 crore; retailisation reached 97% of the overall book.

• Consolidated profit after tax for Q3 FY25 was ₹626 crore, with consolidated book up 16% year-on-year to ₹95,120 crore.

• Technology initiatives advanced, including full rollout of Project Cyclops for AI-driven credit underwriting, launch of AI-based customer chatbot KAI, and expanded digital partnerships with Amazon Pay and PhonePe.

• Utilized ₹100 crore of macro-prudential provisions in Q3 FY25 to manage elevated credit costs in Rural Group Loans & Microfinance due to adverse macro events.

• Consolidated revenue from operations for the quarter ended December 31, 2024, was ₹4,097.58 crore, with total income at ₹4,105.13 crore.

Financial highlights

• Consolidated NIM plus fees at 10.33%, down from 10.86% in Q2 FY25 due to book mix changes; NIM at 8.50% in Q3 FY25.

• Consolidated ROA at 2.27%, down 26 bps year-on-year; ROE at 10.21%, down 1.14% year-on-year.

• Retail disbursements up 5% year-on-year; Farmer Finance disbursements up 23% year-on-year; Home loan disbursements up 24% year-on-year.

• Personal loan disbursements grew 94% year-on-year, with book size up 22% year-on-year; SME Finance disbursements up 29% year-on-year.

• Total income for the nine months ended December 31, 2024, was ₹11,913.76 crore, up from ₹10,377.80 crore for the same period last year.

Outlook and guidance

• Expect continued rural recovery and gradual improvement in urban demand as inflation moderates.

• ROA target remains 2.8%-3% over the medium term, with near-term pressure from credit costs and NIM compression.

• Advance estimate for further macro-provision utilization in Q4 is ₹300–350 crore.

• Retail loan growth guidance to be finalized post-Q4, with a cautious approach in riskier segments.

• Microfinance industry growth expected to normalize to 15%-20% annually post new regulatory guardrails.