Buy L&T Finance Holdings, target price Rs 100: Emkay Global

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Emkay Global has buy call on L&T Finance Holdings Ltd. with a target price of Rs 100. The current market price of L&T Finance Holdings Ltd. is Rs 79.8. Time period given by analyst is one year when L&T Finance Holdings Ltd. price can reach defined target.

L&T Finance Holdings Ltd., incorporated in the year 2008, is a Large Cap company (having a market cap of Rs 19902.60 Crore) operating in NBFC sector.

L&T Finance Holdings Ltd. key Products/Revenue Segments include Dividend, Interest for the year ending 31-Mar-2021.

For the quarter ended 30-09-2021, the company reported a Consolidated Total Income of Rs 3134.46 Crore, down -2.09 % from last quarter Total Income of Rs 3201.49 Crore and down -10.67 % from last year same quarter Total Income of Rs 3508.91 Crore. Company reported net profit after tax of Rs 222.99 Crore in latest quarter.

Investment Rationale
Disbursements would be driven by farm equipment, 2Ws and micro loans. However, the decline in the wholesale portfolio should result in flat AUM growth QoQ and -13% YoY. The firm continues to see increased competition from banks in the infra space. The brokerage expects a 20bps NIM improvement due to the asset mix change, which, in turn, may increase operating expenses, leading to flat operating profits. It expects credit costs of 330bps for Q3 (Q2FY22:357bps).

Promoter/FII Holdings
Promoters held 63.5 per cent stake in the company as of 31-Dec-2021, while FIIs owned 7.86 per cent, DIIs 6.11 per cent.

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