L&T Finance Holdings announces financial results for the quarter and financial year ended March 31, 2019
- PAT at Rs. 2,226 Cr for FY19, YoY growth of 77%
- PAT at Rs. 548 Cr for Q4FY19, YoY growth of 94%
- RoE at 17.92% for FY19 as against 15.73% for FY18
- Retailisation of loan book stands at 52% for FY19 against 42% in FY18
- NIMs plus Fees at 6.75% for FY19 against 5.88% in FY18
- Gross Stage 3 declined to 5.90% in FY19 from 8.71% in FY18
Profitability
L&T Finance Holdings (#LTFH), a leading Non-Banking Financial Company (#NBFC), announced a consolidated PAT of Rs.2,226 Cr for FY19 – a growth of 77% from Rs.1,255 Cr in FY18. For Q4FY19, the consolidated PAT stood at Rs. 548 Cr a YoY growth of 94% over Rs 282 Cr in Q4FY18.
For FY19, RoE stands at 17.92% as against 15.73% in FY18. The RoE for Q4FY19 is at 16.57%. This sustained delivery of top quartile RoE in FY19 has been achieved through focus on retailisation, prudent liquidity management, growth in NIMs plus Fee Income, diversification of funding sources and robust asset quality.
Also Read : Maruti Q4 & Full Year Financial results
LTFH through its subsidiaries has around Rs. 1,800 Cr exposure to 6 Project SPVs of IL&FS. The Resolution Plan submitted by Union of India (at the instance of IL&FS Board) to NCLAT, specifies that these SPVs are capable of servicing loans to secured creditors and there will be priority on payments towards them. As on March 31, 2019, the exposure as secured financial creditor to these SPVs, is in the Stage 1 category and within the “Standard” classification of RBI’s Prudential Norms. This substantiates our view that there will be no provision required towards principal repayment. However, as a measure of commercial prudence and taking a conservative view, an amount of Rs. 84 Cr towards interest of Q3FY19 and Q4FY19 has been reversed. Without this deferment, the PAT and the RoE for FY19 would have been Rs. 2,285 Cr and 18.38%, respectively. Similarly, the PAT and the RoE for Q4FY19 would have been Rs. 607 Cr and 18.32%, respectively.
Growth in businesses
In its focused lending businesses, namely Rural Finance, Housing Finance and Wholesale Finance, LTFH recorded 17% YoY increase in assets in FY19.
| Focused Lending Businesses | FY18 (Rs. Cr) | FY19 (Rs. Cr) | Book Growth (FY19 vs FY18) |
| Rural Finance | 17,044 | 25,577 | 50% |
| Housing Finance | 19,109 | 25,519 | 34% |
| Wholesale Finance | 47,640 | 47,178 | -1% |
| TOTAL | 83,793 | 98,274 | 17% |
The growth in Rural Finance has been contributed by all three businesses – Farm Equipment Finance, Two-Wheeler Finance and Micro Loans. LTFH’s growth in Housing Finance has been primarily contributed by retail home loans. Backed by strong skills in underwriting and project monitoring, the company has been able to maintain a steady pace of disbursements in financing of real estate, renewable energy and operating roads. The products where LTFH didn’t enjoy a strong right to win – structured finance, supply chain finance and DCM, have been deemphasized.
LTFH also delivered growth in its Investment and Wealth Management businesses. Average Assets under Management (AAUM) in Investment Management business increased to Rs.70,944 Cr in Q4FY19 from Rs.65,932 Cr in Q4FY18 – a growth of 8%. Assets under Service (AUS) in Wealth Management business increased to Rs. 28,164 Cr in FY19 from Rs. 18,354 Cr in FY18 – a growth of 53%. Read More
Dividend
L&T Financial Holding Board has recommended a #dividend of Re. 1.00 per Equity Share (face value RS.10 each). The dividend, if approved by the Members at the ensuing Annual General Meeting (“AGM”) will be credited / dispatched within 30 days from the date of AGM. Read More
