LTF - Fundamental Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Fundamental Rating: 4.2

Here’s a comprehensive breakdown of L&T Finance Ltd (LTF)

📊 Core Financials

Revenue & Profit Growth: Quarterly PAT rose from ₹636 Cr to ₹701 Cr, showing consistent growth.

Profit Margins: ROE at 10.8% and ROCE at 8.71% are modest but improving.

Debt Profile: Debt-to-equity ratio of 3.61 is high, indicating leverage risk. However, this is typical for NBFCs.

Cash Flow: Not explicitly provided, but rising profits suggest improving operational cash flow.

💰 Valuation Metrics

Metric Value Interpretation

P/E Ratio 19.4 Below industry average (25.2) — undervalued

P/B Ratio ~2.02 Reasonable for financials

PEG Ratio 0.42 Very attractive — suggests strong growth at low valuation

EPS ₹10.7 Solid earnings base

🧠 Business Model & Competitive Edge

Diversified Lending: Covers rural, housing, infra, and asset management — spreads risk.

Strong Parentage: Backed by L&T Group, lending credibility and stability.

Digital Push: Focus on retail and digital lending enhances scalability and efficiency.

📈 Technical & Sentiment Indicators

RSI (54.2): Neutral — neither overbought nor oversold.

MACD (3.08): Bullish crossover — momentum building.

DMA Support: Trading above 50-DMA (₹195) and 200-DMA (₹171) — positive trend.

🏁 Entry Zone & Long-Term View

Entry Zone: ₹185–₹195 — near 50-DMA and below recent highs.

Holding Guidance: Suitable for long-term holding given strong fundamentals, improving profitability, and attractive valuation. Watch debt levels and asset quality.

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