L&T Finance reported an 18% year-on-year growth in net profit for the quarter ended December, with its retail book expanding 21% to Rs 1.11 lakh crore. Sudipta Roy, Managing Director & CEO, L&T Finance, speaks to Kshipra Petkar on sustaining retail growth momentum and scaling up their gold loan book.
L&T Finance has delivered another strong quarter. How do you plan to sustain this momentum in retail over the next two to three years?
There is no shortcut or magic formula. Sustaining momentum is about relentless execution. We are expanding distribution, improving its granularity, and ensuring that credit quality remains pristine. Our philosophy is very clear—we want to be risk-first and tech-first. As long as credit costs remain stable, it gives us the confidence to grow in a calibrated manner.
What kind of growth rates are you comfortable with, given the broader industry volatility?
We have been very clear that we do not want to grow hyper-fast and get into trouble. A 20–25% growth rate is something we believe is sustainable and sensible. Slow and steady growth, with strong underwriting discipline, is the mantra we are following for the next few quarters.
Beyond personal loans and two-wheeler finance, which retail segments will drive the next phase of growth?
Gold finance will be a key driver. Following our acquisition in this space, we are scaling up rapidly. We are opening one gold loan branch every day, and by the end of the fourth quarter of FY26, we expect to have around 330 branches. This business adds a high-yield, secured product to our portfolio and will meaningfully contribute to growth.
Retail disbursements have risen sharply year-on-year. Is this momentum structural or partly festive-led?
The 49% growth is largely a one-off, driven by the sharp pickup we saw following GST 2.0 reforms. Demand was particularly strong in October and November, and that momentum has since moderated to a steady pace in December. That said, with two-wheeler prices and other product costs having rationalised, we expect a steady-state improvement in demand. Both the segments should see healthy growth over the coming year.
RBI has been emphasising stronger underwriting standards. How confident are you about asset quality over the medium term?
We are very confident. We have deployed advanced risk management tools such as Cyclops, which is an AI-based underwriting engine. Early results have been encouraging, and we expect our risk cost to keep paring down.
Looking ahead, will there be any shift in strategy once the current roadmap concludes?
There will be no shift in strategy. Retailisation will remain our core focus. We will give more detail and colour in the Lakshya 2031 roadmap, which we will share in April.
What are your expectations from the upcoming Union Budget?
We are a rural lender. So, if there is a budget which is very rural-focused and focused on rural income generation, then that is obviously net positive for us