Moneycontrol News
Credit Suisse has maintained a neutral call on L&T Finance with a target of Rs 200 on the back of heightened provisioning requirements.
The global research firm said that the withdrawal of February 18 circular by the Reserve bank of India has resulted in faster recognition of NPAs.
It also said that while the management is targeting 60 percent provisioning cover, but the requirement could be higher as well. Going forward, the provisioning requirement for wholesale sector will be a drag. Adding to the impact would be a transition to Ind-AS accounting system as well.
Further, the pain points are the fact that nearly half of the firm’s pre-2012 stressed book of under construction power projects.
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