### **1. Leadership in Two-Wheeler Finance** - A dominant player in the Indian two-wheeler finance segment, serving over **7.3 million customers** urban India over the past decade. - Operates through **160+ branches**, with strong market penetration in **West Bengal, Tamil Nadu, and Gujarat**. - Sources business through **8,500+ non-captive dealer points** via data-driven OEM and dealer engagement systems. - Offers industry-first **paperless digital loan products** such as: - **Sabse Khaas Loan**: For cash-paying customers. - **Income Proof Loan**: For new-to-credit and near-prime borrowers. - Serves customers across the credit spectrum—from **new-to-credit to prime**, with **82% of disbursements in FY25 going to prime/near-prime borrowers**. --- ### **2. Digital Transformation & Fintech@Scale Strategy** L&T Finance is executing a **technology-first strategy** to become a “Fintech@Scale” organization—embedding digital innovation and data analytics into every layer of operations. #### **Key Tech Initiatives:** | Initiative | Description | |---------|-------------| | **Project Cyclops** | AI-powered digital credit underwriting engine operational across **Two-Wheeler, Farm Equipment, and SME Finance**. - Uses **17–24 ensemble scorecards per segment**. - Built on **Kubernetes-based architecture (Gen 3)**. - Reduces credit costs by **100–150 bps** in newer portfolios. - Enables **straight-through processing** and **risk-based pricing**. | | **Project Nostradamus** | **AI-driven, real-time portfolio management engine** launched in **beta (August 2025)** for two-wheeler finance. - Uses **traditional and alternative data** for granular risk monitoring at micro-market level. - Scheduled for **pan-company rollout by end-FY26**, to be showcased at **Investor Digital Day (Nov 6, 2025)**. - Aims to shift from **reactive to proactive risk management**. | | **PLANET App** | Flagship **D2C (direct-to-consumer) platform**, with **over 1.86 crore downloads** as of July 2025. - Handles **₹15,500+ crore in loan sourcing**, ₹4,800+ crore in collections, and 7.85 crore+ service requests. - Supports **multi-lingual interface (12+ languages)** and integration with **WhatsApp, chatbots, OCR, and video KYC**. - Evolving into a **comprehensive financial ecosystem** via AI, blockchain, and voice-enabled services. | | **KAI – Virtual Home Loan Advisor** | AI-powered conversational advisor with **Retrieval-Augmented Generation (RAG)**. - Offers **EMI calculators, loan eligibility checks**, and 24/7 support without menu navigation. - Enhances **digital mortgage engagement** and customer conversion. | #### **Operational Excellence** - **Collection Efficiency (CE)**: - **Pan-India 0 DPD CE: 99.50%** (up 15 bps QoQ). - **Karnataka: 99.18%** (up 70 bps since June 2025). - **Straight-through processing (STP)** and **100% paperless loan journeys** for rural group loans, personal loans, farm finance, and two-wheeler loans. - **Digital collections** account for **29% in rural**, **95% in urban** markets. --- ### **3. Entry into Gold Loans: Strategic Inorganic Growth** L&T Finance entered the **high-yield secured gold loan segment** in Q1 FY26 via **slump sale acquisition of Paul Merchants Finance’s Gold Loan operations**. #### **Acquisition Highlights (Completed by Jul 2025)** - **₹1,300 crore loan book** with **~1 lakh active customers**. - Integration of **130 branches, 700+ employees**, and **existing technology infrastructure** within **8 weeks**. - Positioned as a **secure, high-return product** to diversify asset base and reduce concentration risk. #### **Strategic Expansion Plan (FY26)** - Target: **330+ gold loan branches** across India. - **~200 new branches** planned, especially in **high cross-sell potential areas** (Eastern & Southern states). - Rollout of **"Sampoorna branches"**: Multi-product outlets offering gold loans, micro LAP, personal loans, and SME finance. #### **Performance (Q1 FY26)** - **Quarterly disbursements: ₹983 crore** - **Monthly disbursements (Sep 2025): ₹423 crore** (record high) --- ### **4. Personal Loans & Big Tech Partnerships** - Personal loan portfolio has grown rapidly: - **Disbursements in Q1 FY26: ₹2,918 crore**, up **114% YoY**. - **Big Tech Partnerships (Amazon Pay, Cred, PhonePe, Google Pay): ₹1,138 crore disbursements** (39% total share). - Strategic focus on **risk-calibrated, scalable digital lending** with: - Trust signal integration. - Co-scoring models. - Strict credit controls. - **52% of personal loan disbursements** in FY25 came from **existing two-wheeler customers**, highlighting cross-selling effectiveness. - Plans to **onboard additional tech partners** and **expand digital reach** without increasing credit risk. --- ### **5. Expansion in New & Growth Segments** | Business | Summary | |-------|--------| | **SME Finance** | - Loan book grew **67% YoY** to ₹6,524 crore in FY25. - Leveraged **Project Cyclops** for improved underwriting. - Uses **Salesforce-based platform** and **Dropline OD** products for flexibility. - Focused on **salaried professionals, traders, and MSMEs**. | | **Micro Loan Against Property (Micro LAP)** | - Secured rural lending product targeting homeowners. - Book size: **over ₹482 crore (FY25)** via **132 branches**. - Leveraging **JLG and MFI customer base** for cross-sell. - New branches integrated with **gold loan operations**. | | **Warehouse Receipt Finance** | - Fully digital, paperless agricultural post-harvest financing. - **₹500+ crore disbursements (FY25)**. - **Zero overdue loans** with **real-time mark-to-market system**. | | **Supply Chain Finance** | - Launched in Q3 FY25 under SME vertical. - Offers **dealer and vendor financing** with strong scalability potential. | --- ## **Strategic Growth Enablers** ### **1. Customer-Centric Model & Cross-Selling** - **Customer Database: Over 2.6 crore customers**, including: - **1.7 crore rural** - **90 lakh urban** - **67% customer repeat rate**, with **40% unique customers** holding only L&T Finance loans. - **34–46% of disbursements** come from **cross-sell/up-sell**: - Two-wheeler → Personal Loans - Rural Group Loans → Micro LAP - Gold Loans → Rural Finance - New product launches (e.g., **Rural LAP, agri-allied loans**) designed to **monetize rural customer ecosystem**. ### **2. Phygital Distribution & Rural Franchise** - Operates in **over 200,000 villages** through **~1,900 rural branches or meeting centers**. - Employs **20,000+ field staff**, with **13,500+ in rural areas** to generate leads locally. - Combines **physical presence** with **digital tools (PLANET App, BRAKE App)** for rural outreach. - **Vernacular communication** and **culturally attuned engagement** to improve relevance in low-digital-adoption areas. ### **3. Data & Risk Management** - **Sophisticated risk tools**: - Customer **lookalike profiling** - **Multivariate pincode analysis** - **Dealership performance tracking** - **GeoIQ integration** for business location insights - Developed **Gen-AI-based Lifestyle Index** (patented) using **image/video analysis** for better risk assessment. - Uses **CNN-based auto-attendance system** for field staff KYC verification. - Strong **first EMI bounce control (2%)** via early warning systems and e-NACH. ### **4. Funding & Credit Profile** - **Debut credit ratings received in Jul 2025**: - **S&P: BBB- (Positive)** - **Fitch: BBB (Stable)** - Funding mix: **~7% commercial paper** (higher than industry average), leveraging **L&T Group association** for lower cost of funds. - Targets **2–2.25% stabilized credit cost** in coming years via improved underwriting. - **Diversified funding base** with access to **priority sector lending**. --- ## **Leadership & Governance** - **Mr. Manish Gupta** joined in May 2025 as key leader with 23+ years in fintech and digital banking (ex-DBS, ICICI, TransUnion), bringing expertise in **digital transformation and AI**. - **Mr. Ashok Dubhashi** led strategic shift from wholesale to retail (2016–2024), growing retail CAGR to 25%+. - Completed **merger of subsidiaries (2023)** for streamlined governance and synergies. ---