L&T Finance has announced robust financial results for FY26, achieving a record annual profit of ₹3,003 crore (pre-Labour Code impact). The company successfully transitioned into a 98% retail-focused franchise, with its retail book growing 26% YoY to ₹1,19,508 crore. Driven by AI-led underwriting through its Project Cyclops initiative, the company improved its credit performance, RoA to 2.37%, and RoE to 11.25%, while maintaining a resilient asset quality.
Financial Highlights of FY26
L&T Finance concluded the fiscal year with significant achievements, reflecting the successful execution of its Lakshya 2026 strategy. The company reported its highest ever annual profit of ₹3,003 crore (before one-time New Labour Code impact). Retail disbursements grew by 39% YoY to reach ₹83,213 crore, bolstering the total retail book to ₹1,19,508 crore. This growth was well-supported by a diversified product mix including Two-Wheeler Finance, Gold Finance, Personal Loans, and Rural Business Finance.
Strategic AI Integration and Operational Efficiency
A core driver of the company’s success has been the implementation of its in-house Digital AI stack. Through Project Cyclops and Nostradamus, L&T Finance has significantly enhanced its underwriting and portfolio management capabilities. This technological push is evident in the Two-Wheeler Cyclops portfolio, which continues to outperform industry credit indicators by a wide margin. Furthermore, the company has successfully deployed 10 enterprise-wide AI Co-pilots, resulting in substantial reductions in underwriting turnaround times and operational overheads.
Maintaining Asset Quality and Sustainable Growth
Asset quality remained resilient throughout the year, with consolidated GS3 at 2.88% and NS3 at 0.96%. The company’s commitment to prudent risk management is reflected in its stable credit cost of 2.54%. Looking ahead, the company has unveiled its Lakshya 2031 goals, which focus on balancing growth with sustainable returns. Key targets for the upcoming planning cycle include 20%+ book growth, <2% credit cost, and an RoA target of 3.0% – 3.2%, as it seeks to position itself as a premier AI-enabled BFSI institution in India.
Source: BSE
