L&T Finance delivered its highest-ever quarterly profit in Q1 FY27, with consolidated net profit rising 28.7% year-on-year to ₹902.47 crore compared with ₹701.10 crore in the same period last year. According to the latest exchange filing, this represents a significant improvement from the previous year's performance, driven by strong retail loan growth, healthy disbursements and improving asset quality. The company achieved total revenue of ₹5,212.92 crore, up 22.4% from the corresponding period last year, while Profit Before Tax (PBT) climbed 31.1% to ₹943.22 crore. Revenue increased 25% to ₹4,894.9 crore and net interest income (NII) grew 28.4% to ₹2,924.8 crore for the quarter. L&T shares opened at ₹321.25 on NSE on Monday, July 13, and touched an intraday high of ₹333.50 per share, rising as much as 4% following the strong quarterly results.
The company's retail business demonstrated exceptional momentum with retail disbursements growing 36% to ₹23,852 crore from ₹17,522 crore in the corresponding quarter of the last fiscal. As reported by the latest exchange filing, L&T Finance achieved its highest-ever consolidated loan book of ₹1.29 lakh crore, up 27% from ₹1.02 lakh crore, while the retail loan book expanded 28% to ₹1.27 lakh crore, exceeding its Lakshya 2031 growth target of over 20%. Gold loan assets grew 182% to ₹3,829 crore following the acquisition of the business last year, while personal loan disbursements more than doubled, rising 126% to ₹4,380 crore, two-wheeler finance disbursements increased 41%, and rural business finance disbursements grew 24%. Housing loan and loan against property disbursements rose 22% during the quarter, highlighting broad-based growth across all retail segments. Among key segments, farmer finance disbursements increased 11% to ₹2,453 crore, SME Finance disbursements rose 23% to ₹1,567 crore, and Gold Finance disbursements climbed 26% to ₹1,928 crore.
Asset quality continued to improve during the quarter, with Gross Stage 3 assets declining to 2.86% from 3.31% a year earlier, while Net Stage 3 improved to 0.90% from 0.99%. According to the latest exchange filing, credit cost fell significantly to 2.55% from 3.43% in the year-ago quarter and was also 10 basis points lower sequentially, reflecting tighter underwriting standards, stronger collections and greater adoption of AI-led risk management. The improved asset quality metrics demonstrate the company's enhanced risk management capabilities and disciplined approach to lending in the evolving macroeconomic environment marked by geopolitical uncertainties, inflationary pressures and elevated borrowing costs. CEO Sudipta Roy highlighted that the company expects credit costs to decline to 2%, in line with its long-term Lakshya targets, and noted that the company has increased provision coverage while remaining prudent on expected credit losses.
The company is significantly enhancing its technology capabilities by adopting an open-source private cloud infrastructure, which is projected to be 70% cheaper than hyperscale cloud platforms over a five-year total cost of ownership. According to the latest reports, CEO Sudipta Roy highlighted that the company's continued investments in technology, analytics and artificial intelligence were strengthening the customer experience, with plans to continue investing in innovation and expanding distribution networks under the Lakshya 2031 strategy. The company is embedding its proprietary AI ecosystem across the entire lending stack from sourcing and underwriting through Project Cyclops to portfolio monitoring through Project Nostradamus, enabling superior credit selection, improved customer experience, faster turnaround times and enhanced operating efficiencies. AI-powered bot calls have already helped save over ₹70 crore in recent months, and Roy added that AI initiatives are expected to reduce operating expenses by 30-40 basis points over the next three to four years. The company is also leveraging digital partnerships across platforms such as Google Pay, CRED, PhonePe and MobiKwik to support customer acquisition and digital loan sourcing.
L&T Finance shares rose as much as 4% following the strong quarterly results, with the stock trading at ₹321.25 on NSE as of Monday, July 13, and touching an intraday high of ₹333.50. According to Mint, JM Financial maintained its 'add' rating with a target price of ₹305, saying that the company has reported stronger-than-expected non-interest income drove a 4% beat in PPOP with reported NIM+fees stable at 10.47%. Motilal Oswal said that LTF's Q1FY27 earnings were broadly in line, supported by strong disbursements, leading to healthy retail loan growth. The brokerage noted that asset quality remained broadly stable, leading to a sequential moderation in credit costs. Speaking to Mint, 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 emphasized that Q1FY27 was another quarter where the company remained focused on disciplined execution amidst an evolving macroeconomic environment marked by geopolitical uncertainties, inflationary pressures and elevated borrowing costs.
