L&T Finance Q2 net profit rises 33% to Rs 975 crore
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AgenciesIts consolidated loan book stood at Rs 1.36 lakh crore, up 28% year-on-year.
Speaking to ET, Sudipta Roy, MD & CEO of L&T Finance, said he expects AUM growth momentum of around 20% to continue in the third quarter.
Net interest margin (NIM), or the difference between interest earned and interest paid, rose to 10.48% from 10.22% a year ago.
“L&T Finance will maintain NIM in the 10-10.50% band in the third quarter and does not expect any meaningful change in the lending rates offered by banks to us,” Roy said.
The average cost of borrowing for L&T Finance has declined to 6.95% from 7.32% a year ago, he said. Even if system-level interest rates rise due to hike in repo rate, the impact on L&T Finance is unlikely to be significant as the company front-loaded a substantial portion of its borrowings in the second quarter, he added.
The non-bank lender’s total income increased 26% year-on-year to Rs 5,484 crore, while interest income rose 28% to Rs 5,158 crore. Fee and commission income increased to Rs 326 crore from Rs 289 crore.
Profit before tax increased 33% to Rs 1,319 crore from Rs 989 crore a year earlier.
Asset quality improved, with gross non-performing loans declining to 2.7% from 3.2% a year ago.