LTFS fourth quarter results feel the heat of the ongoing pandemic crisis

While announcing the financial results for the quarter and financial year ended March 31, 2020, the company said the reduction in PAT is largely due to the additional provisions taken to strengthen the balance sheet to be able to face the aftermath of Covid-19 pandemic.

The company said that as the second largest financier of Farm Equipment Finance in the country, its market share increased to 15% in Q4 FY20 from 14% in Q3 FY20.

The company was the fifth largest Two-Wheeler financier with an increase in market share to 11% in Q4FY20 from 9% in Q3FY20.

The company was the third largest Micro loans provider, and in the home loans segment, its share of salaried customers increased to 64% from 48% YoY.

The company said it remained resilient in Q4FY20, enduring the challenges posed by Covid-19 by continuing to focus on the strengths it has built over the past few years.

Given the Covid-19 pandemic and difficult situation in the debt market, LTFH said it maintained higher than normal liquidity, remaining comfortably placed to meet all obligations of the coming months.

The liquidity of Rs 15,485 crore included liquid assets of Rs 8,468 crore, undrawn bank lines of Rs 5,017 crore and back up line of Rs 2,000 crore from L&T Ltd.

LTFH said it was able to raise long-term funding from broad based sources, garnering Rs 28,225 crore in FY 20, its highest ever annual long-term borrowing. The company focused on further diversifying the funding sources and raised Rs 9,415 crore (Priority Sector Lending, retail NCDs and ECBs) from new sources in FY20.

LTFH and all its lending subsidiaries have been assigned/reaffirmed AAA rating by CRISIL, India Ratings, ICRA and CARE, notwithstanding multiple downgrades across the sector.

Dinanath Dubhashi, Managing Director & CEO, LTFH, said, “The inherent strength of the business model will be proven as we face one of the worst economic situations experienced by the entire world. While our disbursement, collection and asset quality has remained strong during Q4FY20, there is a clear need to counter the difficulties facing the economy in FY21. Accordingly, we have further strengthened our balance sheet by building substantial incremental provisions as well maintaining the comfortably positive ALM and enhanced liquidity.”

LTFH is promoted by Larsen & Toubro Ltd, one of the leading companies in India, with interests in engineering, construction, electrical & electronics manufacturing & services, IT and financial services.

Image Credit: LTFS-Facebook