ICICI Direct's research report on Larsen and Toubro Finance Holding
L&T Finance Holding (LTFH) is a leading NBFC catering to the diverse financing needs of underserved customers in urban and rural areas. LTFH is engaged in consumer loans, 2wheeler loans, home loans, MFI, farm & SME loans. • Backed by a strong parent, LTFH has been assigned "AAA" rating • Distribution network remains strong with substantial dealer penetration (2500+ dealers in farm equipment & 6500+ tie-ups in 2 wheeler segment), 2 crore customers (database) spread across 21 states & one union territory.
Outlook
At the CMP, LTFH currently trades at ~1.2x ABV offering room for further expansions as RoE, RoA are expected to reach ~10%, ~2.1%, respectively, in FY23-25E. Hence, we assign a target price of Rs 160/share, valuing at ~1.6x FY25E ABV and recommend BUY rating on the stock.
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