L&T Finance , a leading non-banking financial company (NBFC), has reported a robust performance for the second quarter of fiscal year 2026 (Q2FY26), with significant growth in key financial metrics and strategic initiatives.

Financial Highlights

• Consolidated Profit After Tax (PAT) reached Rs 735 crore, marking a 6% year-on-year (YoY) growth and a 5% quarter-on-quarter (QoQ) increase.
• The retail book crossed the Rs 1 lakh crore milestone, standing at Rs 1,04,607 crore, reflecting an 18% YoY growth.
• Consolidated book size grew by 15% YoY to Rs 1,07,096 crore.
• Return on Assets (RoA) stood at 2.41%, while Return on Equity (RoE) was 11.33%.

Record-Breaking Disbursements

L&T Finance achieved its highest-ever quarterly disbursements of Rs 18,896 crore, representing a 25% YoY and 8% QoQ growth. This performance was driven by strong growth across various business segments:

Technological Advancements

The company's AI-powered Project Cyclops underwriting engine now powers 100% of underwriting in Two-Wheeler, Farm Equipment, and SME businesses. This has led to improved portfolio performance, including reduced bounce rates and net non-starters (NNS).

Credit Cost Improvement

Credit costs (before macro prudential provisions) improved from 3.80% in Q4FY25 to 2.98% in Q2FY26. The company utilized Rs 150 crore from macro prudential provisions, leaving Rs 125 crore remaining.

Collection Efficiency

Pan-India collection efficiency in microfinance improved to 99.50% from 99.35% in the previous quarter, indicating a strengthening portfolio quality.

Strategic Expansion

The gold loans business achieved Rs 983 crore in quarterly disbursements, with plans to expand to over 330 branches by the end of FY26, signaling a strong push into this secured lending segment.

Digital Partnerships

Personal loans disbursements surged 114% YoY to Rs 2,918 crore, driven by partnerships with major tech platforms including Amazon Pay, Cred, PhonePe, and Google Pay. These partnerships have significantly boosted the company's digital lending capabilities.

Outlook

L&T Finance maintains its AUM growth guidance of 20-25% and targets a 2% credit cost trajectory over the medium term. The company's focus on risk-calibrated growth, technological innovation, and strategic partnerships positions it well for sustained performance in the evolving financial services landscape.

Mr. Sudipta Roy, Managing Director and CEO of L&T Finance, commented on the results, stating, "Our core business franchise stands in good shape, evidenced by the numbers posted in Q2FY26. We are confident that this performance trajectory will continue in the remainder of FY26, supported by our ongoing investments in strengthening the company and upgrading our capabilities across domains."

As L&T Finance continues to leverage its technological advancements and strategic initiatives, the company appears well-positioned to capitalize on the growing credit demand in the Indian market, particularly in the retail segment.

L&T Finance Limited (LTF), one of India's leading non-banking financial companies, has announced its financial results for the second quarter, showcasing strong performance across key metrics.

Highlights

• Highest ever Profit After Tax (PAT) of ₹735 Crore, up 5% QoQ and 6% YoY
• Retail Book crosses the ₹1 lakh Crore milestone
• Retail portfolio at ₹1,04,607 Crore, reflecting an 18% growth YoY
• Highest ever Retail disbursements for Q2 at ₹18,883 Crore, up 25% YoY
• Retailisation stands at 98%

Financial Performance

LTF reported a consolidated PAT of ₹735 Crore for Q2, marking a 6% increase year-over-year. The company's retail book demonstrated robust growth, crossing the ₹1 lakh Crore milestone to reach ₹1,04,607 Crore, an 18% increase compared to the same quarter last year.

Asset Quality

The company maintained a stable asset quality profile:

• Gross Stage 3 (GS3) at 3.29% in Q2 vs. 3.19% in Q2 of the previous year
• Net Stage 3 (NS3) at 1.00% in Q2 vs. 0.96% in Q2 of the previous year

Business Segment Performance

Strategic Developments

1. International Credit Rating Upgrade: S&P Global Ratings upgraded LTF's long-term issuer credit rating to "BBB/Stable" from "BBB-/Positive".

2. Digital Initiatives:

   • Project Nostradamus beta launched for the Two-wheeler business.
   • Project Cyclops implemented in Two-wheeler Finance, Farm Equipment Finance, and SME Finance.

3. Partnerships: Google Pay added as a big-tech partner for Personal Loans origination.

4. Gold Loan Expansion: Plans to add around 200 new branches, taking the gold distribution strength to about 330 branches.

Management Commentary

Mr. Sudipta Roy, Managing Director & CEO of LTF, stated, "During the quarter, our focus remained firmly on execution and growth, enabling us to deliver a strong performance in a quarter traditionally considered a weak one in the BFSI industry. The performance highlights the improved momentum in all our lines of business, across rural and urban geographies, driven by the transformation initiatives carried over the last few quarters."

He added, "On the back of good monsoons and improving customer consumption sentiment, we are confident that this momentum will accelerate in H2 on the back of festive demand fueled by GST 2.0 reforms."

LTF continues to make strides in its digital transformation and customer-centric approach, positioning itself for sustained growth in the evolving financial services landscape.