Insights

L&T Finance Holdings Ltd.

April 22, 2017 . Equities Desk

Transformation in motion…

L&T Finance Holdings Ltd. (LTFH) is a financial holding company offering a diverse range of financial products and services across retail, corporate, housing and infrastructure finance sectors. It also has presence in asset management and investment management services.

Valuation:

After undergoing significant business restructuring in FY16, LTFH has made substantial progress in achieving scale in its focus business verticals. As a result, we expect return ratios (1.9% RoA and 17.2% RoE by FY19E) to show a marked improvement over the next two years. We expect LTFH to deliver a loan growth CAGR of ~15% over FY16-19E which coupled with higher operating efficiency and improvement in credit cost will help in delivering ~24% earnings CAGR for the consolidated entity. We initiate coverage on LTFH with a BUY rating and assign TP of Rs135 (P/ABV of 3.0x for FY19E) valuing it at a premium to its four-year mean (P/ABV of 2.2x for 1 year forward ABV).

Research Report – L&TFH

Investments in equity shares, debentures, etc., are not obligations of, or guaranteed by Wealth India Financial Services Pvt. Ltd., and are subject to investment risks. Click here to read our full disclaimer.

2 thoughts on “L&T Finance Holdings Ltd.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

sek