L&T Finance posts robust 31% PAT growth; revenue up 22% YoY on strong AUM expansion
L&T Finance delivered a strong quarter with consolidated PAT of ₹916 Cr, marking 31% growth YoY and 13% sequentially, outpacing management's FY-27 guidance trajectory. Revenue grew 22.4% YoY to ₹5,213 Cr, driven primarily by robust interest income growth of 23% to ₹4,895 Cr, reflecting expanding AUM amid favourable credit cycle tailwinds. Net profit margin expanded 102 bps YoY to 17.47%, underpinned by operating margin expansion of 157 bps to 23.71%, demonstrating strong operational leverage. The company's credit cost (impairment at 11.2% of revenue) remains elevated but is on glide path towards management's target of 2.0–2.2% by Q4 FY-27, aiming for 3.0–3.2% RoA under the 'Lakshya 2031' strategic plan. Fee income held steady at ₹318 Cr despite seasonal dynamics, with employee cost discipline maintained at ₹698 Cr. The quarter reflects solid execution against near-term guidance of 20%+ AUM growth and stable NIM+fee contribution, positioning the company favourably for FY-27 delivery.
Key Highlights
- Consolidated PAT ₹916 Cr, up 30.7% YoY (Q1 FY-26: ₹701 Cr) and 13.2% QoQ (Q4 FY-26: ₹809 Cr), tracking management's 20%+ AUM growth guidance for FY27
- Consolidated revenue ₹5,213 Cr, up 22.4% YoY and 9.3% QoQ, driven by 3.3% interest income growth to ₹4,895 Cr alongside stable fee income at ₹318 Cr
- Net Profit Margin expanded 102 bps YoY to 17.47% (Q1 FY-26: 16.45%) and 51 bps QoQ; Operating Margin up 157 bps YoY to 23.71%—both metrics showing operational leverage
- Impairment expense at ₹583 Cr (11.2% of revenue); on track for targeted 2.0-2.2% credit cost reduction by Q4 FY-27 as per management guidance
- EPS (basic, not annualised) ₹3.60 consolidated, up 28% YoY from ₹2.81; employee cost discipline maintained at ₹698 Cr despite higher volumes
- Balance sheet: Equity share capital ₹2,504 Cr (after allotment of 11.20 lakh ESOP shares); other equity ₹25,479 Cr; capital ratio and liquidity metrics strong
Price Impact
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