The stock climbed to an intraday high of ₹333.40 and was trading 2.32% higher at ₹328.70 as of 10:41 am.
L&T Finance reported a 28.7% year-on-year rise in consolidated net profit to ₹902 crore for the first quarter of FY27, while revenue increased 25% to ₹4,894.9 crore and net interest income (NII) grew 28.4% to ₹2,924.8 crore.
The company’s consolidated loan book reached a record ₹1.29 lakh crore, up 27% from a year ago, driven by a 28% increase in its retail loan book to ₹1.28 lakh crore. Retail disbursements rose 36% year-on-year to ₹23,852 crore, while asset quality improved, with gross Stage 3 assets declining to 2.86% from 3.31% a year earlier.
Brokerages positive on earnings, asset quality
Nomura maintained its ‘Buy’ rating on the stock with a target price of ₹370, saying first-quarter profit exceeded its estimate by 8%.
The target price implies a 13% upside on the stock’s current trading levels.
The brokerage said asset quality trends were encouraging, particularly in the two-wheeler financing business, where AI-led underwriting engines have helped improve performance. It raised its FY27-FY29 earnings estimates by 2-10%, while flagging the monsoon and proposed insurance distribution reforms as key risks.
JPMorgan retained its ‘Neutral’ rating with a target price of ₹320, saying pre-provision operating profit and net profit were about 4% ahead of its estimates. The stock is currently trading around JPMorgan’s target levels.
The brokerage said stronger-than-expected fee income and lower operating expenses more than offset slightly weaker net interest margins, which it attributed to the company maintaining a higher liquidity buffer amid geopolitical uncertainty.
JPMorgan also noted that gross Stage-2 and Stage-3 assets improved sequentially, although it expects investors to monitor asset quality trends closely through the monsoon season. The brokerage added that the stock’s recent rally, with gains of 23% over the last month, has expanded valuations and could limit further re-rating.
Management maintains growth outlook
Speaking to CNBC-TV18, Managing Director and CEO Sudipta Roy reiterated the company’s target of achieving more than 20% compound annual loan growth, adding that growth could accelerate if opportunities arise.
Roy said the company maintained a higher liquidity buffer during the quarter because of the West Asia conflict, which weighed on margins, while stressing that the lender remains focused on a risk-calibrated growth strategy.
He added that L&T Finance expects credit costs to decline to 2%, in line with its long-term Lakshya targets, and said the company has increased provision coverage while remaining prudent on expected credit losses.
Roy also highlighted the company’s growing use of artificial intelligence, saying AI-powered bot calls have already helped save over ₹70 crore in recent months. He added that AI initiatives are expected to reduce operating expenses by 30-40 basis points over the next three to four years.
L&T Finance also said its retail lending momentum remained strong, with partnerships across platforms such as Google Pay, CRED, PhonePe and MobiKwik supporting customer acquisition and digital loan sourcing.
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