L&T Finance Holdings saw its highest-ever retail disbursements of ₹10,238 crore in Q2 FY23, which pushed the retail loan book to ₹52,040 crore — 27 per cent higher year-on-year and 9 per cent quarter-on-quarter.
The non-bank company posted a net profit of ₹406 crore for Q2 FY23, an increase of 81 per cent y-o-y and 55 per cent q-o-q, largely on the back of improvement in margins and asset quality.
The strong retail disbursements were led by loans worth ₹4,418 crore given under rural business finance, ₹1,304 crore under farmer finance and ₹1,328 crore under consumer loans.
“Our retail portfolio mix has reached 58 per cent, up from 47 per cent in Q2 FY22, aided by the steady growth witnessed across business segments,” said MD and CEO Dinanath Dubhashi.
Driven by data analytics-led business rule engines, the company saw robust disbursements, especially in rural business finance and two-wheeler finance, aided by a collection-led disbursement strategy, he added.
However, on an overall basis, loan growth was muted at 4 per cent YoY and 2 per cent QoQ to ₹90,098 crore, largely due to a decline in the wholesale book and the company shedding its exposure to ‘non-focussed’ business areas.
Net interest margin and fees for the quarter was at 8.4 per cent in Q2FY23, 85 bps higher from the corresponding quarter of the previous year.
Gross stage 3 assets ratio of the company improved to 4.0 per cent as of September 30 from 4.1 per cent a quarter ago and 6.5 per cent a year ago. The net stage 3 assets ratio was also better at 1.9 per cent compared with 2.9 per cent in the previous year but flat compared with the previous quarter.