L&T Finance Q2 FY27: consolidated PAT +32% YoY to ₹973 Cr, revenue +26%, margins expand

L&T Finance's consolidated PAT rose 32.4% YoY to ₹972.76 Cr in Q2 FY27, with total income up 26.5% YoY to ₹5,484.23 Cr — comfortably ahead of our pre-result preview range of ₹900–950 Cr profit on ₹5,200–5,400 Cr revenue, and consistent with a Street that went in decisively constructive (14 of 19 analysts rated Buy/Strong Buy, median target ₹330 against a ₹257.4 price). QoQ growth was far more modest (PAT +6.2%, revenue +4.6%), underlining that the YoY comparison — not the sequential print — is the real signal here. Standalone PAT of ₹968.25 Cr (+33.1% YoY) tracked the consolidated number closely, so both bases tell the same story this quarter. Net profit margin expanded to roughly 17.7% of total income, up from about 17.5% last quarter and 17.0% a year ago, even as finance costs climbed to ₹1,970.47 Cr from ₹1,634.29 Cr YoY on a larger, more leveraged balance sheet (debt-equity 4.21x). The offset came from stronger interest and fee income growth outpacing the rise in funding and opex costs. Impairment on financial instruments rose to ₹628.69 Cr from ₹505.55 Cr YoY — working out to roughly 2% of the average loan book annualised, broadly in line with management's sub-2% credit-cost target but a line worth watching as the retail/microfinance book scales further. There were no exceptional items in either the current or year-ago quarter, so the YoY PAT growth is clean with no one-off distortion to adjust for. Growth was underpinned by retail disbursements up 27% YoY to roughly ₹24,000 Cr and a loan book up 29% YoY to ₹1.32 lakh crore (standalone) — ahead of management's 20%+ CAGR book-growth guidance under the Lakshya 2031 plan, and consistent with the "profitable, quality-led growth" framing from the Q1 FY27 call. The company also raised debt through the quarter (₹800 Cr and ₹650 Cr NCDs, ₹52 Cr subordinated NCDs), funding the loan-book expansion; borrowings rose to ₹86,078 Cr from ₹77,146 Cr at FY26-end. No management press release accompanying this result was available in our records, so this read rests on the filing and prior concall commentary alone. Against the Q1 FY27 call's RoA guidance (2.48% in Q1, targeting 2.8% by Q4 FY27), this quarter's growth and margin trajectory point in the right direction, though the filing does not disclose a quarterly RoA figure directly to confirm the pace. The next checkpoints are whether credit costs hold near the 2% ceiling as the microfinance book scales, and whether margin expansion continues once funding costs catch up with a balance sheet that has grown 11% since March 2026.