Analyst Research Report Snapshot

Title:

L&T Finance Holding Ltd. | Q2FY14 First Cut Analysis

Price:

$23.00

Provider:

IndiaNivesh Securities Pvt Ltd

Date:

23 Oct 2013

Pages:

3

Type:

AcrobatPDF

Companies referenced:

LTFH.NS

Available for Immediate Download
Summary:

L&T Finance Holding Ltd. (LTFHL) | Q2FY14 First Cut Analysis Numbers as per expectations but NPA continue to increase Net Interest Income (NII) of LTFHL increased at a healthy rate of 18% y-o-y (down 2% q-o-q) to Rs 4.6 bn in Q2FY14. Interest income grew 32% y-o-y (6% q-o-q) and interest expense grew at a much faster pace of 41% y-o-y (12% q-o-q) to Rs 12.3 bn and Rs 7.7 bn respectively. Valuation: LTFHL’s Q2FY14 result was disappointing on asset quality front; however loan book momentum remains healthy driven by disbursals (at a slow pace) in both financing subsidiaries. Asset quality deteriorated further and we expect that stress on asset quality will remain for next two quarters. At CMP of Rs 77, the stock is trading at P/ABV of 2.3x and 2.0x for FY14E and FY15E respectively. The stretched valuation and deterioration in assets quality leaves limited upside. We maintain HOLD rating on a stock with a target price of Rs 81.

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