L&T Finance Ltd — Q1 FY27 earnings call
Summary generated by AI from the official transcript L&T Finance Ltd filed with BSE on 20 Jul 2026. Every statement cites a verbatim quote from that document — open any citation to read it. This is a record of what management said, not a recommendation. How we check these summaries
The short read
L&T Finance reported consolidated PAT of ₹902 crore for Q1FY27, up 29% YoY, with the consolidated book crossing ₹1,29,634 crore, up 27% YoY. Retail disbursements grew 36% YoY to ₹23,852 crore, credit cost moderated to 2.54%, and RoA improved to 2.48% while RoE rose to 12.71%. Management discussed progress on its Lakshya 2031 strategic plan, AI initiatives including Project Cyclops, Nostradamus and Hercules, and provided updates on the Gold Loan, Personal Loans, SME and Rural Business Finance segments.
Numbers mentioned
Consolidated PAT: ₹902 Cr (Q1FY27)
p. 4
“During Q1FY27, we recorded our highest ever quarterly consolidated profit after tax of ₹902 Cr, representing a growth of 29% YoY.”
Sudipta Roy, page 4 of the filed PDF · View the filing
Consolidated book: ₹1,29,634 Cr (Q1FY27)
p. 4
“Our consolidated book crossed another important milestone, reaching ₹1,29,634 Cr, reflecting a healthy YoY growth of 27% with an RoA of 2.48%, reflecting a growth of 11 basis points YoY.”
Sudipta Roy, page 4 of the filed PDF · View the filing
Retail disbursements: ₹23,852 Cr (Q1FY27)
p. 4
“This has been achieved on the back of robust quarterly retail disbursements of ₹23,852 Cr, up 36% YoY, with contributions from all our lines of business, demonstrating the continued strength of our diversified retail franchise.”
Sudipta Roy, page 4 of the filed PDF · View the filing
Credit cost: 2.54% (Q1FY27)
p. 5
“I'm pleased to inform you that consequently credit cost moderated to 2.54%, reflecting another quarter of sequential improvement of 10 basis points, supported by our continued focus on strengthening credit administration, collections excellence and AI-led portfolio management.”
Sudipta Roy, page 5 of the filed PDF · View the filing
NIMs + Fees: 10.47% (Q1FY27)
p. 5
“Stable NIMs + Fees at 10.47%, despite a competitive operating environment further demonstrate the resilience of our business model.”
Sudipta Roy, page 5 of the filed PDF · View the filing
RoE: 12.71% (Q1FY27)
p. 5
“This has resulted in our RoA improvement to 2.48%, while RoE increased to 12.71%.”
Sudipta Roy, page 5 of the filed PDF · View the filing
Personal Loans disbursement growth: 126% YoY (Q1FY27)
p. 6
“a 126% YoY growth in Personal Loans, a 41% YoY Cyclops powered growth in the Two Wheeler Finance segment, a 24% YoY growth in Rural Business Finance, a 22% YoY growth in Housing Loans, a 23% YoY growth in SME Finance disbursements and a 11% YoY growth in Farmer Finance disbursements.”
Sudipta Roy, page 6 of the filed PDF · View the filing
Gold Finance book: ~₹3,800 Cr (Q1FY27)
p. 10
“The business has grown to a book size of ~₹3,800 Cr, registering a growth of over 180% YoY.”
Sudipta Roy, page 10 of the filed PDF · View the filing
Retail book: ₹127,535 Cr (Q1FY27)
p. 10
“Retail book stands at ₹127,535 Cr, up 28% YoY. Our Consol book stands at ₹129,634 Cr, up 27% YoY”
Sachinn Joshi, page 10 of the filed PDF · View the filing
NIM: 8.54% (Q1FY27)
p. 12
“So, we can see clearly that the NIMs have reduced by 24 basis points from 8.78% in Q4 to 8.54% in Q1FY27.”
Sachinn Joshi, page 12 of the filed PDF · View the filing
Weighted Average Cost of Borrowing: 7.20% (Q1FY27)
p. 12
“Actually, Weighted Average Cost of Borrowing (WACB) is up just 3 basis points between the two quarters, you know, moving from 7.17% to 7.20%.”
Sachinn Joshi, page 12 of the filed PDF · View the filing
Debt-equity ratio: 3.97x (Q1FY27)
p. 12
“But debt-equity which was 3.73x, has gone to 3.97x, about 0.24x higher.”
Sachinn Joshi, page 12 of the filed PDF · View the filing
Personal Loans average yield: about 16% plus (Q1FY27)
p. 22
“Overall, our weighted average yield in the Personal loans business is about 16% odd, 16% plus is our weighted average yield in the Personal loans business.”
Sudipta Roy, page 22 of the filed PDF · View the filing
Cost to build Cyclops and Nostradamus: ₹37 Cr and ₹33 Cr
p. 22
“Overall, we have spent roughly about ₹38 Cr to build Cyclops and overall we have spent roughly about ₹33 Cr for Nostradamus and ₹37 Cr for Cyclops, but the fact is that we are still in the process”
Sudipta Roy, page 22 of the filed PDF · View the filing
PCR on Security Receipts: 68% (Q1FY27)
p. 24
“The PCR on the SRs, the security receipts, when we started off on this resolution process was 58% and that has now actually gone and increased to 68%.”
Sachinn Joshi, page 24 of the filed PDF · View the filing
What management said it would do
A record of statements made on the call, in the words management used. Parakho does not forecast, endorse or assess them, and their presence here is not a view on whether they will happen.
Book growth CAGR — 20%+ CAGR · Lakshya 2031 period
stated firmly by Sudipta Roy
p. 6
“We had set ourselves a Book growth CAGR of 20%+ over the Lakshya period.”
Sudipta Roy, page 6 of the filed PDF · View the filing
Credit cost — 2% or less · Lakshya period
stated as an aspiration by Sudipta Roy
p. 6
“Second, on the Credit Cost front, we will endeavour to drive Credit Costs down to a level of 2% or less over the Lakshya period.”
Sudipta Roy, page 6 of the filed PDF · View the filing
RoA — 3.0-3.2% · FY31
stated firmly by Sudipta Roy
p. 7
“Our Return on Assets (RoA) target remains in the range of 3.0–3.2% for FY31.”
Sudipta Roy, page 7 of the filed PDF · View the filing
RoA — 2.8% · Q4FY27
stated firmly by Sudipta Roy
p. 7
“We remain committed to work on achieving the 2.8% RoA threshold in Q4FY27 as communicated earlier.”
Sudipta Roy, page 7 of the filed PDF · View the filing
RoE — 16-18% · FY31
stated firmly by Sudipta Roy
p. 7
“Against a Lakshya 31 RoE target of delivering a Return on Equity (RoE) in the range of 16-18% by FY31, RoE increased to 12.71% in Q1FY27 from 10.86% (RoE after macro prudential provisions) in Q1FY26.”
Sudipta Roy, page 7 of the filed PDF · View the filing
Project Hercules rollout — Q3FY27
stated firmly by Sudipta Roy
p. 9
“We are targeting rollout of this platform by Q3FY27.”
Sudipta Roy, page 9 of the filed PDF · View the filing
Gold Finance branch additions — ~500 new branches · FY27
stated firmly by Sudipta Roy
p. 10
“Following the launch of 200 branches in FY26, we are now working on deploying ~500 new branches in FY27, accelerating our velocity to ~1.4 branches addition daily.”
Sudipta Roy, page 10 of the filed PDF · View the filing
WACB — 7.35% to 7.40% · FY27
stated conditionally by Sachinn Joshi
p. 16
“So yearly WACB may actually go up from 7.35% for FY26 to maybe about anywhere between 7.35% and 7.40% that is what we are currently envisaging.”
Sachinn Joshi, page 16 of the filed PDF · View the filing
Gold Loans growth trajectory — Q2FY27
stated conditionally by Sudipta Roy
p. 14
“However, there has been continuous improvement in May and June, and I expect the Gold loans business to have a normal growth trajectory in Q2FY27 because that period of adjustment and learning in Q1FY27 is behind us.”
Sudipta Roy, page 14 of the filed PDF · View the filing
Credit cost — 2% to 2.2% or lower · FY28
stated conditionally by Sudipta Roy
p. 28
“For modelling exercise, yes, you can plug that in, because that is what we are committed to. If you have said that by Q4 we are between 2% to 2.2%, then obviously in FY28, if we have to maintain our good performance, we have to be in that trajectory or lower.”
Sudipta Roy, page 28 of the filed PDF · View the filing
NIMs + Fees corridor — 10% to 10.5%
stated firmly by Sachinn Joshi
p. 28
“So, Shreepal, Sachinn here. In terms of NIMs implications, you know, we stick to the corridor of 10% to 10.5%, which we have given.”
Sachinn Joshi, page 28 of the filed PDF · View the filing
CGFMU coverage of Micro Finance disbursements — 35% to 40% · current year
stated firmly by Sachinn Joshi
p. 31
“Just to add, since we are taking it for the first time, in this year itself, we will cover about 35% to 40% of the total disbursement that we make in the current year for Micro Finance.”
Sachinn Joshi, page 31 of the filed PDF · View the filing
Q&A highlights
Management's answers to analyst questions, in Parakho's words rather than a transcript. Each row names who answered and carries the verbatim quote it was drawn from.
Management explained that surplus liquidity held due to geopolitical uncertainty raised interest costs while the deployed surplus generated fee/other income, keeping combined NIMs+Fees flat.
Answered by Sachinn Joshi
Asked by Kunal Shah: What is driving the divergence between declining NIMs and rising other income, and what is the sustainable trajectory?
p. 12
“So there is this other income which actually includes some of the, you know, surpluses which were deployed, the income is coming in that fee and other income, correspondingly the interest cost is part of the NIM.”
Sachinn Joshi, page 12 of the filed PDF · View the filing
Management said SME caution was due to the West Asia war fallout risk on certain sectors, and Gold Loans slowed due to new RBI guardrails on tiered loan demand assessment introduced in April.
Answered by Sudipta Roy
Asked by Kunal Shah: Why were SME and Gold Loan disbursements slower this quarter?
p. 14
“As a result of that, you know, we erred on the side of side of caution just to make sure that we are completely compliant with the RBI guidelines.”
Sudipta Roy, page 14 of the filed PDF · View the filing
Management pointed to individual scorecards per digital partner, a shift toward salaried customers, and low gross/net non-starter rates as evidence of quality despite Nostradamus being new.
Answered by Sudipta Roy
Asked by Shreya Shivani: Given Nostradamus was only just implemented in Personal Loans, what confidence exists in the book's quality?
p. 15
“In fact, our gross non-starters in Personal loans business is lower than 3% right now.”
Sudipta Roy, page 15 of the filed PDF · View the filing
Management attributed roughly 20 bps to the disappearance of the ARC portfolio drag, 30-40 bps to credit cost/credit administration efficiency, and a smaller amount to business expansion.
Answered by Sudipta Roy
Asked by Avinash Singh: How will the 80 bps RoA improvement to the Lakshya target be achieved?
p. 18
“I do believe that about 30 to 40 basis points will come from efficiency in credit cost as well as credit-related cost, which I call the cost of credit administration, specifically collections cost etc.”
Sudipta Roy, page 18 of the filed PDF · View the filing
Management clarified the GS3 increase relates to a settlement already provided for (Supertech) and is not expected to add further credit cost, with the wholesale book otherwise standard and running off.
Answered by Sachinn Joshi
Asked by Abhishek Murarka: Has the credit cost guidance factored in any slippage from the wholesale book given the GS3 increase?
p. 24
“The GS3 small increase that you are referring to, is actually part of a settlement that we have already done and whatever hit is to be taken has been already factored in.”
Sachinn Joshi, page 24 of the filed PDF · View the filing
Management said they do not operate on an FLDG model with any partner and instead underwrite entirely on their own credit terms, paying partners only an origination fee.
Answered by Sachinn Joshi
Asked by Piran Engineer: Do the large digital partners for Personal Loans provide FLDG (first loss default guarantee)?
p. 29
“No, we don't work on a FLDG model with any one of them. So, it's completely our own credit.”
Sachinn Joshi, page 29 of the filed PDF · View the filing
Risks flagged
Volatility from geopolitical uncertainty including the Iran-US conflict affecting liquidity and cost of funds
p. 12
“the other reason is also due to the geopolitical situation being a bit difficult on account of war in Iran, we had maintained slightly higher surplus liquidity of close to ₹4,200 Cr.”
Sachinn Joshi, page 12 of the filed PDF · View the filing
Potential impact of El Nino and uneven monsoon on rural cash flows and asset quality
p. 17
“Yes, rains are delayed, El Nino is supposed to lead us to a sort of a lower-than-average monsoon, that is what is projected.”
Sudipta Roy, page 17 of the filed PDF · View the filing
Regulatory changes to insurance commissions affecting fee income
p. 18
“Thirdly, on the question on insurance etc., yes, we are aware of some of these developments, but I'd like to point out that it is not only, you know, it is not only for us, it is for the industry.”
Sudipta Roy, page 18 of the filed PDF · View the filing
New RBI gold loan guardrails causing origination disruption industry-wide
p. 14
“So just like across the industry, some of the origination volumes fell; we saw a fall in our origination volumes in the month of April.”
Sudipta Roy, page 14 of the filed PDF · View the filing
Rising cost of funds due to volatile global yields and geopolitical situation
p. 27
“So, we have for the time being been very conservative and assumed that there could be one or two rate increases which may happen.”
Sachinn Joshi, page 27 of the filed PDF · View the filing
Generated by claude-sonnet-5. Source: the transcript as filed with BSE. We link to the exchange's copy; we do not host transcripts. Parakho is a data and screening tool, not an investment adviser — nothing here is a recommendation to buy, sell or hold.