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LTF: Lower Risk Profile Will Support Stronger Market Re-Rating Ahead

India's Digital Transformation And Urbanization Will Expand Retail Lending

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LTF
AnalystHighTarget
Not Invested
Published 02 Jul 2025

Update shared on 19 Dec 2025

Fair value Increased 35%
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AnalystHighTarget's Fair Value
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1Y
121.9%
7D
-0.6%

Analysts have raised their price target on L&T Finance from ₹260 to ₹350, citing expectations of slightly faster revenue growth, modestly higher profit margins, and an improved future valuation multiple, driven by a lower perceived risk profile.

What's in the News

  • The board meeting is scheduled for October 15, 2025, to review and approve unaudited standalone and consolidated financial results for the quarter and half year ended September 30, 2025 (Board Meeting).
  • The board will review disclosure of related party transactions for the half year ended September 30, 2025, in line with Regulation 23(9) of the Listing Regulations (Board Meeting).
  • An upcoming Analyst and Investor Day will provide strategic updates and engage with the investment community (Analyst/Investor Day).

Valuation Changes

  • Fair Value: Raised significantly from ₹260 to ₹350 per share, reflecting a more optimistic assessment of L&T Finance's intrinsic value.
  • Discount Rate: Reduced slightly from 14.33 percent to 13.68 percent, indicating a modestly lower perceived risk profile and cost of equity.
  • Revenue Growth: Projected annual revenue growth has risen slightly from 36.48 percent to 38.35 percent, suggesting marginally stronger operating momentum.
  • Net Profit Margin: Expected net profit margin has edged up from 27.58 percent to 28.97 percent, pointing to modestly improved profitability assumptions.
  • Future P/E: Forward valuation multiple has increased from 17.30x to 21.07x, implying investors are now willing to pay a higher price for anticipated earnings.

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Disclaimer

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