L&T Finance Q1 FY26: PAT ₹701 Cr, book hits ₹1.02 lakh Cr

Key takeaways from the quarter

L&T Finance Ltd (NSE: LTF, BSE: 533519) reported a steady operating quarter in Q1 FY26, with profitability improving sequentially and the loan book reaching a new high. Consolidated profit after tax (PAT) came in at ₹701 crore, up 2% year-on-year (YoY) and 10% quarter-on-quarter (QoQ). The consolidated book rose to ₹102,314 crore, a 15% YoY increase from ₹88,717 crore. The retail franchise continued to dominate the balance sheet, with a retailisation level cited at about 98%. Retail disbursements for the quarter grew 18% YoY to ₹17,522 crore (also reported as approximately ₹17,510 crore in a provisional update). The company also reported improved profitability metrics, with ROA at 2.37% and ROE at 10.86%.

Profitability: PAT up QoQ, returns improve

The headline profit number for Q1 FY26 was ₹701 crore, reflecting modest YoY growth and a stronger sequential improvement. Alongside PAT, management highlighted that consolidated ROA stood at 2.37%, improving by 15 basis points QoQ. Consolidated ROE was reported at 10.86%, up 73 basis points QoQ. These figures suggest the company maintained returns even as it scaled retail assets. The update also referenced consolidated “NI plus fee” at 10.22% for the quarter, compared with 10.15% in Q4 FY25.

Loan book hits a record, retail dominates

L&T Finance said its highest-ever consolidated book reached ₹102,314 crore in the quarter. The company’s retail book was reported at ₹99,816 crore, up 18% YoY. Retailisation, measured as retail share of the portfolio, was indicated at roughly 98% in Q1 FY26, compared with 95% in the same quarter last year. The company also stated it surpassed its Lakshya 2026 retailisation target of 95%. Separately, management commentary noted a retail book growth target of 25% CAGR over a four-plan period and said the retail asset book growth stood at 28% CAGR as of June 30, 2025.

Disbursements rise 18% YoY, mix led by retail

Quarterly retail disbursements increased 18% YoY to ₹17,522 crore, from ₹14,839 crore in the comparable period. The company attributed growth to secured products such as farmer finance, home loans and loans against property (LAP), and gold loans, while personal loans drove momentum in unsecured assets. A provisional business update also pegged retail disbursements at about ₹17,510 crore for Q1 FY26.

Segment performance: what grew and what slowed

Disbursement and book trends varied across product lines in the quarter, based on segment-level numbers shared. Rural Business Finance disbursements were ₹5,618 crore, down 3% YoY, while its book grew 3% to ₹26,616 crore. Farmer Finance disbursements rose 16% YoY to ₹2,200 crore, and the book increased 11% to ₹15,756 crore. Two-wheeler finance disbursements fell 19% YoY to ₹2,128 crore, though the book edged up 3% to ₹12,331 crore. Personal loans stood out with disbursements up 65% YoY to ₹1,942 crore, and the book up 41% to ₹9,383 crore. Housing loans and LAP disbursements increased 24% YoY to ₹2,780 crore, while the book grew 33% to ₹26,464 crore. SME finance disbursements rose 30% YoY to ₹1,273 crore, with the book up 56% to ₹6,964 crore.

Asset quality and customer metrics

L&T Finance reported stable asset quality indicators for the quarter. Gross Stage 3 was 3.31% and net Stage 3 was 0.99%. On the franchise side, the company said it added 5.5 lakh new customers during the quarter, taking the customer base to over 2.6 crore.

Strategy and technology: gold loans and underwriting automation

The company highlighted two operating levers for growth and risk management. First, it said it integrated a ₹1,530 crore gold loan portfolio from Paul Merchants Finance, expanding gold lending into new geographies. Second, it highlighted “Project Cyclops”, describing AI and ML-based underwriting as operational across two-wheelers with 100% coverage, with extension planned to farm equipment and SME segments.

Management commentary and operating environment

MD and CEO Sudipta Roy said the company delivered a resilient performance in what he described as a challenging quarter, with a focus on outcomes and the ability to manage market headwinds. The emphasis in the update was on retail-led growth, calibrated risk, and technology-led execution. The company also noted the retail book’s YoY growth reflected early benefits from technology investments.

Snapshot table: Q1 FY26 metrics disclosed

Additional disclosures: FY-end and Q4 FY26 reference

Alongside the Q1 FY26 update, the provided text also referenced a separate set of retail milestones for a period ended March 31, 2026. It stated the retail book stood at ₹119,508 crore, up 26% compared with the financial year ended March 31, 2025. It also reported highest-ever annual retail disbursements of ₹83,213 crore, up 39% YoY, and highest-ever quarterly retail disbursements of ₹24,107 crore, up 62% for the quarter ended March 31, 2026. These figures were presented in the source text as additional context on retail scale.

What investors will track next

For investors, the key operational markers from the quarter are the pace of retail book growth, disbursement momentum across secured and unsecured products, and stability in Stage 3 levels. Another monitorable item is execution on underwriting automation as Project Cyclops expands beyond two-wheelers. The company’s updates on portfolio mix and risk metrics in subsequent quarterly disclosures will help track whether growth remains calibrated across segments.