L&T Finance · forward-looking guidance across the available source record.
Guidance tracker
Management committed to achieving credit cost of 2% to 2.2% by Q4 FY27, down from current 2.54%, through continued Cyclops implementation across businesses, improved collections infrastructure, and portfolio seasoning. FY28 expected to maintain or improve upon this range.
Targeting ROA of 2.8% by Q4 FY27, improving from current 2.48% (up 11bps YoY), with path toward Luxure 2031 target of 3-3.2% ROA. Key levers include 20bps from ARC portfolio drag resolution, 30-40bps from credit cost improvement, and operating leverage from technology investments.
NIM plus fees guidance corridor of 10% to 10.5% maintained through mix management (accelerating high-yielding products like gold loans, personal loans, microfinance), yield optimization, fee income from cross-sell and payments business, though cost of funds may rise 4-5bps in FY27.
Luxure 2031 targets 20%+ CAGR book growth; Q1 FY27 tracking at 27% YoY. Whenever market conditions are conducive, management will grow at faster pace than target but will never compromise risk for growth. Personal loan growth rates will moderate as base grows larger over next couple of quarters.
Management aims to trend toward 2% credit cost, with FY27 expected to show significant improvement as Cyclops implementation completes across all business lines including personal loans (Q3 FY26), home loans, LAP, and MFI (FY27).
Management reaffirmed 2.8-3.0% ROA target by FY27 exit, stated on organic basis without factoring in any stress-related asset recovery (SR) benefits.
Despite near-term pressure from mix shift (higher gold loans, competitive housing), management sees support from rate cuts, PSL advantage, and ability to grow commercial paper book from 7% to 13-15%.
Operating expenses plus credit cost expected to decline from 7% toward 6% as investments normalize and portfolio quality improves, with collections costs also declining multiplier-effect. Full realization expected during FY27.
Trajectory of 3.8% → 3.43% → 2.98% → 2.83% demonstrates sustained improvement. Management confident of achieving guided corridor, potentially earlier if tailwinds persist.
Current ROA of 2.31% (excluding exceptional items: 2.37%) expected to improve on back of credit cost normalization, operating leverage, and improved business momentum.
Currently at 10.41%, management will maintain within this range through product mix optimization (gold loan, micro LAP growth) and continued funding cost efficiencies.
64 new branches added in Q3; focus on high cross-sell potential areas with SAMB (multi-product) integration. 200+ additional branches planned for FY27.