LTF

(8 L&T Finance January 23, 2024 National Stock Exchange of India Limited BSE Limited Exchange Plaza, Corporate Relations Department, Plot No. C/1, G Block, 1st Floor, New Trading Ring, Bandra - Kurla Complex, Bandra (East), P. J. Towers, Dalal Street, Mumbai - 400 051. Mumbai - 400 001. Symbol: L&TFH Security Code No.: 533519 Kind Attn: Head – Listing Department / Dept of Corporate Communications Sub: Submission of investor / analyst presentation Dear Sir / Madam, With reference to our letter dated January 16, 2024 and pursuant to Regulation 30 read with Para A of Part A of Schedule III of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“Listing Regulations”), please find enclosed the presentation to be made to the investor(s) / analyst(s). Further, as per Regulation 46 of the Listing Regulations, the said presentation would also be available on website of the Company i.e., www.ltfs.com/investors. We request you to take the aforesaid on records. Thanking you, Yours faithfully, For L&T Finance Holdings Limited Apurva Rathod Company Secretary and Compliance Officer Encl: As above L&T Finance Holdings Limited Registered Office Brindavan, Plot No. 177, C.S.T Road Kalina, Santacruz (East) T +91 22 6212 5000 Mumbai 400 098, Maharashtra, India F +91 22 6212 5553 CIN: L67120MH2008PLC181833 E igrc@ltfs.com www.ltfs.com {fiJ L&T Finance Strategy & Results Update – Q3FY24 1 INTERNAL Disclaimer L&T Finance Holdings Limited (the “Company”) offers a range of financial products and services under the L&T Finance (LTF) brand. The information in this presentation is provided by the Company for information purposes only. This presentation or any information herein may not be used, reproduced, copied, photocopied, duplicated or otherwise reproduced in any form or by any means, or re-circulated, redistributed, passed on, published in any media, website or otherwise disseminated, to any other person, in any form or manner. This presentation does not constitute an offer or invitation or inducement to purchase or sell or subscribe to, any securities of the Company, nor shall it or any part of it or the fact of its distribution form the basis of, or be relied on in connection with, any contract or commitment therefor. This presentation is not a prospectus, a statement in lieu of a prospectus, an offering circular, an advertisement or an offer document to purchase or sell securities under the Companies Act, 2013 and the rules made thereunder, the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018, the Securities and Exchange Board of India (Issue and Listing of Non-convertible Securities) Regulations, 2021 or any other applicable law, as amended from time to time. This presentation is for general information purposes only, without regard to any specific objectives, financial situations or informational needs of any particular person. No representation, warranty, guarantee or undertaking, express or implied, is or will be made or any assurance given as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of any information, estimates, projections or opinions contained herein. Potential investors must make their own assessment of the relevance, accuracy and adequacy of the information contained in this presentation and must make such independent investigation as they may consider necessary or appropriate for such purpose. The statements contained in this presentation speak only as at the date as of which they are made, and the Company expressly disclaims any obligation or undertaking to supplement, amend or disseminate any updates or revisions to any statements contained herein to reflect any change in events, conditions or circumstances on which any such statements are based. Neither the Company nor any of its affiliates, its board of directors, its management, advisers or representatives, or any other persons that may participate in any offering of securities of the Company, shall have any responsibility or liability whatsoever (in negligence or otherwise) for any loss (direct or indirect) howsoever arising from any use of this presentation or its contents or otherwise arising in connection with this presentation. The Company may alter, modify or otherwise change in any manner the contents of this presentation, without obligation to notify any person of such revision or changes. Certain statements made in this presentation may be “forward looking statements” for purposes of laws and regulations of India and other than India. These statements include descriptions regarding the intent, belief or current expectations of the Company or its directors and officers with respect to the results of operations and financial condition, general business plans and strategy, the industry in which the Company operates and the general, business, competitive and regulatory environment of the Company. These statements can be recognized by the use of words such as “expects,” “plans,” “will,” “estimates,” “projects,” or other words of similar meaning. Such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and actual results may differ from those in such forward-looking statements as a result of various factors and assumptions, including future changes or developments in the Company’s business, its competitive environment, information technology and political, economic, legal, regulatory, environmental and social conditions in India, which the Company believes to be reasonable in light of its operating experience in recent years. The Company does not undertake to revise any forward-looking statement that may be made from time to time by or on behalf of the Company. The distribution of this presentation in certain jurisdictions may be restricted by law and persons in whose possession this presentation comes should inform themselves about, and observe, any such restrictions. The financial figures, information, data and ratios (audited and unaudited) other than consolidated PAT, provided in this presentation are management representation based on internal financial information system of the Company.ThesefinancialfiguresarebasedonrestatementofcertainlineitemsintheconsolidatedfinancialstatementsoftheCompanyanddescribethemannerinwhichthemanagementoftheCompanymonitorsthefinancial performance of the Company. There is a possibility that these financial results for the current and previous periods may require adjustments due to changes in financial reporting requirements arising from new standards, modificationstotheexistingstandards,guidelinesissuedbytheMinistryofCorporateAffairsandRBI. By accessing this presentation, you accept this disclaimer and that any claims arising out of or in connection with this presentation shall be governed by the laws of India and the courts in Mumbai, India shall have exclusive jurisdiction over the same. Disclaimer clause of RBI: The Company has a valid certificate of registration dated September 11, 2013 issued by the RBI under section 45 IA of the RBI Act. However, the RBI does not accept any responsibility or guarantee about the present position as to the financial soundness of the Company, or for the correctness of any of the statements or representations made or opinions expressed by the Company, and for repayment of deposits/ discharge of liabilities by the Company. e l&T Finance 2 Lakshya 2026 RETAIL. DIGITAL. SUSTAINABLE. To be a top-class ‘digitally-enabled’ retail finance company moving from ‘product-focused’ to ‘customer-focused’ approach 33 INTERNAL Agenda A Journey towards Lakshya 2026 Lakshya 2026 Update Q3FY24 in Perspective Fintech@Scale Update B Annexures e l&T Finance 4 INTERNAL Lakshya 2026 Goals - Achieved 2 years in advance Retail Asset Retailisation Retail Growth Retail RoA Quality GS3 <3% >80% >25% CAGR 2.8% - 3% NS3 <1% ✓ ✓ ✓ ✓ 5 ✓ Achieved INTERNAL L&T Finance Holdings transitions into a Retail NBFC Retail NBFC Lakshya Goals Merger Completed Achieved With achievement of Lakshya goals & merger • L&T Finance & L&T Infra Credit LTFH becomes a Retail NBFC straddling the • Retailisation @ 91% merged with hold co – Rural & Urban ecosystem • Retail book growth @ 31% YoY L&T Finance Holdings • Retail Asset Quality @ Way Forward: • ‘AAA’ reaffirmed post merger by GS3: 2.95% & NS3: 0.64% To make Lakshya goals achieved sustainable CRISIL, ICRA, CARE, India Ratings through convergence of goals at Consol level PREDOMINANTLY RETAIL ONE LENDING ENTITY ONE RETAIL NBFC 6 L&T Finance Holdings is engaged primarily in the business of financing and accordingly, there are no separate reportable segments as per Ind AS 108 “Operating Segments” INTERNAL Going forward… CONVERGENCE OF GOALS AT CONSOL LEVEL BY FY2026 Consol Consol Retailisation Retail Growth Asset Quality RoA GS3 <3% >95% >25% CAGR 2.8% - 3% NS3 <1% THROUGH CYCLE ACHIEVEMENT OF THESE GOALS WILL MAKE PERFORMANCE AT L&T FINANCE CONSISTENT, PREDICTABLE & SUSTAINABLE 7 INTERNAL 5 Pillars to creating a sustainable & predictable Retail franchise .,. ••·ere Enhancing Sharpening Implementing Heightened Capability Customer Acquisition Credit Underwriting Futuristic Digital Architecture Brand Visibility Building 0 0 0 0 0 1 2 3 4 5 • Broadening customer funnel • Focused enhancement and • Building a self-learning credit • Optimizing digital journeys to • Enhancing brand presence & velocity while increasing optimization of talent pool in: eliminate chokepoints & across channels engine based on bureau, throughput provide a superlative o Artificial Intelligence / • Harvesting the customer & account aggregator & experience to customers • Building salience & recall for Machine Learning increasing cross-sell, while alternate data signals to make brand ‘L&T Finance’ • In-house engineering for o Credit & Risk keeping risk under control underwriting more robust enhanced time to market o Tech & Engineering • Launching contiguous product offerings 8 INTERNAL Why are we confident of achieving convergence of goals at Consol level? CONSOL ROA +87 bps 2.8% - 3% 2.53% 2.42% 2.13% 1.90% 1.66% 1.55% 1.33% 1.02% Q4FY22 Q1FY23 Q2FY23 Q3FY23 Q4FY23 Q1FY24 Q2FY24 Q3FY24 FY26 L J +11 bps Post delivery of Consol RoA of 2.53% in Q3FY24, focus would be on reaching the threshold RoAs by FY26 9 INTERNAL Agenda A Journey towards Lakshya 2026 Lakshya 2026 Update Q3FY24 in Perspective Fintech@Scale Update B Annexures e l&T Finance 10 INTERNAL L&T Finance – ~Rs 75,000 Cr Retail digital franchise built over 15 years STRADDLING THE RURAL & URBAN ECOSYSTEM RURAL : ~Rs 37,000 Cr Book URBAN : ~Rs 37,000 Cr Book 1,700+ Branches 150+ Branches Pan-India ~2,00,000 Villages 100+ Cities / Towns Geo presence ~20,000 employees 6,000+ employees Field force Rural Group Loans & Micro Farm Agri Allied Two wheeler Home Loan Personal Loan SME Finance Micro Finance (JLG) LAP Equipment 3,000+ 60+ 6,500+ 600+ 20+ 190+ Direct Direct Dealer Accredited Dealer Channel Online Acquisition Channel Partnerships Warehouses Partnerships Partnerships Partnerships Partnerships Channels WOMEN FARMERS SALARIED / SELF EMPLOYED BUSINESSPERSON / PROFESSIONAL ENTREPRENEURS ~0.75 Cr ~1.5 Cr Customers Customer database Customer database Active customer New customers Share of up-sell in Disbursement per Customer Franchise 93 Lac+ 6.8 Lac+ 33% ~Rs 86K franchise disbursed to (in Q3) disbursement up-sell franchise 11 INTERNAL Delivering a sustained Retail disbursement growth of 25% YoY (1/4) Pivoted to highest ever quarterly disbursements of Rs. 14,531 Cr with growth across all segments in Rs Cr Retail Disbursements +25% YoY 14,531 13,499 11,607 Q3FY23 Q2FY24 Q3FY24 +8% QoQ Rural Business Finance Farmer Finance Urban Finance SME Finance 5,740 5,476 5,386 4,281 4,572 4,859 2,057 2,027 1,534 872 965 538 Q3FY23 Q2FY24 Q3FY24 Q3FY23 Q2FY24 Q3FY24 Q3FY23 Q2FY24 Q3FY24 Q3FY23 Q2FY24 Q3FY24 • Monthly disbursal run-rate of Rs. ~1,800 • Prime & EV segment in TW registered 7% • Maintained monthly disbursal run rate of • Enhanced customer retention through Cr maintained during the quarter YoY growth in disbursals owing to Rs. 300 Cr+ upselling of Kisan Suvidha (accounting for • Strengthening customer retention with a deepening & new tie ups with leading • Deepened geo presence by 56 new 18% of disbursements), a top-up product healthy share of vintage borrowers industry players locations following hub & spoke model • Leveraging on the D2C autonomous • Maintaining optimal geo-mix by focusing • Increased HL disbursements by building • Expansion of channel ecosystem through Kisan Suvidha journey on growth-identified geographies new distribution channels digital & voice initiatives 12 Confident of sustaining Retail growth trajectory on the back of differentiated offerings & superior customer value INTERNAL Delivering a sustained Retail disbursement growth of 25% YoY (2/4) Through optimum mix of customer retention & cross sell RURAL Rural Group Loans & Micro Finance (JLG) Farm Equipment Finance Total disbursements Analytics driven dealer relationships for higher counter share 70% of 29% of total disbursements total disbursements 70% of total fresh disbursements Total disbursements Repeat customer share LTF exclusive customer share Total Fresh disbursements Kisan Suvidha Total disbursements Rs 5,476 Cr Rs 3,824 Cr Rs 1,575 Cr Rs 1,672 Cr Rs 355 Cr Rs 2,027 Cr 18% Customer retention Repeat disbursements are only Higher customer retention Top dealers share through top up to ‘0 DPD’ customers through focused targeting Rs 1,419 Cr products 13 INTERNAL Delivering a sustained Retail disbursement growth of 25% YoY (3/4) Through optimum mix of customer retention & cross sell URBAN Two wheeler Finance Personal Loans Created Personal Loans product from 2W for 66% 34% cross sell / up sell 50% of total disbursements 2W Loyalty / Top up Total Total disbursements Top dealers share Online Acquisition customers / PLANET disbursements Rs 2,540 Cr Rs 1,269 Cr Rs 559 Cr Rs 288 Cr Rs 847 Cr Analytics driven dealer relationships for higher counter share Leveraging existing 2W % of disbursements Q3FY23 Q4FY23 Q1FY24 Q2FY24 Q3FY24 customer database Prime customer share (2W) 35% 35% 37% 37% 41% 14 Consumer Loans has been renamed as Personal Loans INTERNAL Delivering a sustained Retail disbursement growth of 25% YoY (4/4) Through optimum mix of customer focused products URBAN Home Loans & LAP SME Finance 76% 24% 53% 47% Total Total Home Loans LAP Term Loan Overdraft facility disbursements disbursements Rs 1,512 Cr Rs 487 Cr Rs 1,998 Cr Rs 508 Cr Rs 457 Cr Rs 965 Cr Optimising returns through balanced portfolio Leveraging channel partnerships & branch network to grow in desired segments 15 INTERNAL Leading to Retail book growth of 31% YoY in Rs Cr Retail Book +31% YoY 74,759 69,417 57,000 Q3FY23 Q2FY24 Q3FY24 +8% QoQ Rural Business Finance Farmer Finance Urban Finance SME Finance 31,253 33,529 21,672 23,110 25,947 17,485 12,447 13,351 13,845 2,413 3,078 838 Q3FY23 Q2FY24 Q3FY24 Q3FY23 Q2FY24 Q3FY24 Q3FY23 Q2FY24 Q3FY24 Q3FY23 Q2FY24 Q3FY24 • Focusing on geographic expansion of • Concerted efforts towards digitization & • Growth through proactive portfolio • Maintained robust growth momentum mortgage & 2W product categories channel expansion helped scale-up management using digital and data led by vertical as well as horizontal analytics • Optimising digital journeys across • Crossed the milestone booksize of Rs. deepening&strongcustomerretention Urban products 3,000 Cr • Augmented offerings to exclusive • Digital touch free collections reached • Moving to advance Bureau+ model • Geo-expansion and focus on specific customersthroughPragatiloans 49% in Q3FY24 from 39% in Q3FY23 (including account aggregator & credit ticket segments to act as next levers for insights) to enhance BRE growth Strong growth witnessed across all Retail segments 16 BRE – Business Rule Engine While displaying superior collection efficiencies over time RURAL BUSINESS FINANCE FARMER FINANCE 17 & SNAOL PUORG LARUR TNEMPIUQE MRAF )GLJ( ECNANIF ORCIM ECNANIF SME FINANCE – URBAN BUSINESS ECNANIF EMS URBAN FINANCE RELEEHW OWT GNISUOH LIATER SNAOL LANOSREP ECNANIF INTERNAL FY23 ~ FY24 ~ FY23 ~ FY24 199.8%1 199.8%1 199.8%1 199.9%1 199.8%1 199.8%1 199.8%1 199.8%1 199.8%1 I I 98.o¾ 1 98.8% 1 198.1•1. 1 198.3%1 198.6%1 I I I 199.5%1 199.5%1 199.6%1 199.7% 1 199.7%1 199.8%1 199.8%1 199.8%1 199.8%1 99.8% 1 99.8% 1 99.8% 1 I I I I 97.6% 98.3% 197.8%1 198.4%1 198.2% 1 198.1% 1 198.4% 1 Apr May Jun Jul Auq Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar ~ FY23 ~ FY24 ~ FY23 ~ FY24 199.4%1 199.6%1 199.8%1 199.7%1 199.2%1 199.4%1 199.4%1 199.7%1 189.9%1 190.6%1 191.2%1 191.2%1 191.1% 1 191.9% 1 190.2%1 191.9%1 199.4%1 199.4%1 199.0%1 199.6%1 199.2%1 ! 9 9.3% 1 I 9 9.2% 1 199.4%1 199.6%1 199.5%1 199.6%1 199.8%1 lss.s¾I 190.4%1 190.9%1 191_4•1.1191.1%1193.6%1 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar ~ FY23 ~ FY24 199.1%1 199.1%1 198.9%1 ~ FY23 ~ FY24 I I I I I I I I I I 98.8% 1 98.8% 1 198.5%1 198.2%1 198.7%1 198.6%1 98.8% 1 99.o% 1 1100.0% 11100.0% 99.7% 99.7% 1 !99.8%1 !99.8%1 j99.7%I !99.9%1 99.8% 1 99.8% 1 199.9%1 l I j99.7%I 199.8%1 99.7% 1 99.4% 1 j99.8%j j99.7%1 199.6%1 j99.7%1 J Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Regular CE = cashflow received from 0 dpd customer for billing / billing of 0 dpd customer INTERNAL …& best-in-class ‘0 DPD’ across flagship products RURAL GROUP LOANS & FARM EQUIPMENT TWO WHEELER FINANCE MICRO FINANCE (JLG) FINANCE 88.9% 97.1% 83.0% 80.3% 87.2% 78.6% Industry LTF Industry LTF Industry LTF Best-in-class 0 DPD portfolio of LTF vis-à-vis the Industry 18 Industry figures are for the immediately preceding quarter reported as per bureau data INTERNAL … resulting in pristine Retail Asset Quality (1/2) Stagewise assets & provision summary G Q3FY23 Q2FY24 Q3FY24 Stage wise (in Rs Cr) Q3FY23 Q2FY24 Q3FY24 R (% of Total) (% of Total) (% of Total) O S Stage 1 53,382 93.65% 65,433 94.26% 70,591 94.42% S A Stage 2 1,642 2.88% 1,868 2.69% 1,963 2.63% S S Stage 3 1,976 3.47% 2,116 3.05% 2,206 2.95% E T Total 57,000 100% 69,417 100% 74,759 100% S Q3FY23 Q2FY24 Q3FY24 Stage wise (in Rs Cr) Q3FY23 Q2FY24 Q3FY24 P (% PCR) (% PCR) (% PCR) R O Stage 1 304 0.57% 484 0.74% 471 0.67% V I Stage 2* 1,025 62.41% 1,261 67.51% 1,296 66.05% S I O Stage 3 1,569 79.40% 1,665 78.65% 1,739 78.85% N Total 2,897 5.08% 3,409 4.91% 3,507 4.69% N Q3FY23 Q2FY24 Q3FY24 Stage wise (in Rs Cr) Q3FY23 Q2FY24 Q3FY24 E (% of Net Assets) (% of Net Assets) (% of Net Assets) T Stage 1 53,079 93.62% 64,949 94.22% 70,120 94.39% A S S Stage 2 617 1.10% 607 0.89% 666 0.91% E T Stage 3 407 0.73% 452 0.67% 466 0.64% S *Stage 2 provisionsinclude Macroprudential provisions 19 Stage wise book and corresponding provisions is based on customer dpd INTERNAL … resulting in pristine Retail Asset Quality (2/2) Retail - Asset Quality 0 0 0 79% 79% 79% 2,206 2,116 13% 1,976 11% 9% 7% 5% 3.47% 407 3.05% 452 2.95% 466 3% 0.73% 0.67% 0.64% 1% - - -1% Q3FY23 Q2FY24 Q3FY24 • • 0 GS3 (Rs Cr) NS3 (Rs Cr) GS3 (%) NS3 (%) PCR (%) e l&T Finance 20 Asset Quality numbers are based on EAD INTERNAL Agenda A Journey towards Lakshya 2026 Lakshya 2026 Update Q3FY24 in Perspective Fintech@Scale Update B Annexures e l&T Finance 21 INTERNAL App as a powerful digital channel for customer PLANET App Features OUR ‘PLANET’ APP FEATURES Completed In Progress (Launched in March 2022) Servicing features Engagement features Autonomous journeys View Loan Account Mandi Price Details & update Profile (Farm customer) Rewards & Download SOA & D2C journey Referrals Insurance for Personal Loan Repayment Schedule Marketplace Download Interest Certificate D2C journey Utility Credit Score for 2W Loan Payments Download Welcome Kit EMI calculator D2C journey for Rural Group Loans Income Download NOC & & Micro Finance Expense Tracker Foreclosure report Update D2C journey for Mandate Details Farm Top Up Make Foreclosure & Part Payments 22 Servicing channel enroute to becoming a geo-agnostic sourcing channel INTERNAL App as a powerful digital channel for customer (1/2) PLANET App: Service Measurement Metrics upto Q3FY24 Update Rs. 800 Cr+ Rs. 4,600 Cr+ 130 Lac+ 9 Lac+ Collections Sourcing Servicing Experience Rural Customers Rs in Cr Q1 FY23 Q2 FY23 Q3 FY23 Q4 FY23 Q1 FY24 Q2 FY24 Q3 FY24 SOURCING -- 127 843 630 1,168 1,175 715 COLLECTIONS 3 28 63 104 132 191 296 SERVICING (%) 10% 29% 38% 42% 47% 47% 67% 76,00,000+ 72,62,550 3,80,972 Downloads 4.3 4.3 Downloads Downloads 23 INTERNAL App as a powerful digital channel for customer (2/2) PLANET App: Service Measurement Metrics upto Q3FY24 Update Count in lacs Q1 FY23 Q2 FY23 Q3 FY23 Q4 FY23 Q1 FY24 Q2 FY24 Q3 FY24 SERVICING 1.5 7.4 14.4 18.6 21.5 26.0 41.4 RESOLUTION Mainly includes: SOA Downloads 0.9 4.3 7.5 9.3 8.9 9.4 10.9 Repayment Schedule 0.6 2.9 5.8 6.0 6.0 7.6 6.6 Payments 0.1 0.6 1.6 2.7 3.2 4.0 5.0 Statutory Kits (Welcome, NOC etc) - 0.1 0.3 0.9 2.6 4.3 8.5 Credit Score - 1.8 4.8 6.1 5.5 6.4 5.8 Digital 14% channels 83% 35% 51% 11% 6% 24 12’RAM DEC’23 Servicing channels (% of interactions across channels) Call centre Inverting the Servicing Pyramid Branches INTERNAL Developing Digital Finance Delivery as a customer value proposition Q3FY24 Update Digital Delivery: Touching every part of the customer ecosystem 100% 100% 95% 19% 94% Paperless Journey in Rural Group Loans, Digital eNach Digital Digital 2W Finance, Disbursements Penetration Collections Collections Farm Equip. Finance, (Rural + Urban) (Urban) (Rural) (Urban) Personal Loans Customer focused digital first approach in not only Urban but also in Rural 25 INTERNAL Summing up Q3FY24 - Achieved Lakshya 2026 goals Retailisation Retail Growth Retail Asset Quality Retail RoA LAKSHYA 2026 GS3 <3% >80% >25% CAGR 2.8% -3% GOALS NS3 <1% x ✓ ✓ ✓ ✓ Lakshya 2026 goals achieved 2 years in advance Merger Update Completed merger of L&T Finance Ltd & L&T Infra Credit Ltd with L&T Finance Holdings Ltd to create a ‘Single Lending Entity’ Performance Update Consol RoA at Consol RoE at Retail disbursements at Retail Book at Consol PAT at 2.53 % 11.35 % Rs. 14,531 Cr (up 25% YoY) Rs. 74,759 Cr (up 31% YoY) Rs. 640 Cr (up 41% YoY) (up 87 bps YoY & 11 bps QoQ) (up 292 bps YoY & 54 bps QoQ) 26 INTERNAL Index of Annexures I Our dominant Retail Franchise built over a decade II Financials III Other Annexures e l&T Finance 28 INTERNAL A Retail franchise built over a decade FARMER FINANCE RURAL BUSINESS FINANCE (Farmer) (Small Rural Entrepreneur) RURAL Rural Group Loans (JLG) Farm Equipment Finance Micro Finance (JLG) Kisan Suvidha Vishwas Loans Agri-allied Pragati Loans Micro LAP Two wheeler Finance Personal Loan Loans to Professionals Home Loans Business Loans Loan Against Property URBAN URBAN FINANCE SME (Urban Individual) (Urban Business) 29 INTERNAL … backed by established sustainable differentiators Strong & well provided balance Amongst Top financiers in Retail Granular customer franchise & D2C App: PLANET sheet space Distribution network Consol PCR at 75%, built macro Seen multiple cycles, 2.2 Cr+ customer database, Creating an augmented channel prudential buffers vintage 10+ years 28,000+ Partner touch points ijJ L&TFinance Rural & Urban eco space; Targeting 100+ Fintech Partner Integrations, 33% of disbursements are to Repeat ~25% CRAR individuals & businesses 50+ algorithms customers ‘AAA’ liability Straddling the entire Retail customer Transformational Digital High Customer franchise spectrum & Data Analytics Retention / cross-sell 30 INTERNAL Helped create market leadership in fulcrum products over a decade in Rs Cr Rural Group Loans & Micro Finance (JLG) Farm Equipment Finance Two wheeler Finance 14+ years of Vintage 18+ years of Vintage 10+ years of Vintage ~1.4 Cr customers serviced in rural India 11 Lac+ customers serviced in rural India 70 Lac+ customers serviced in urban India - - __ CAGR CAGR CAGR _. --- 53% 18,693 15% 26% -- --- 8,960 B O 7,819 12,476 12,495 12,207 13,278 7,362 8,438 10,261 11,317 12,819 -- -- -- -- -- 5,739 6,575 7,122 7,462 O K 414 916 2,234 3,551 .31,589 .41,739 .41,649 .41,379 . 5 1 ,811 .1.1.1.1.1. 1,124 1,436 1,761 2,110 3,414 - - FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 CAGR CAGR CAGR -- --· D I 45% 16,910 13% ---23% -- -- 7,110 6,450 S --- -- B 10,903 9,884 9,950 3,864 3,821 4,477 5,152 -- 4,968 4,901 4,436 5,084 U R S 606 1,178 2,536 3,514 7,214 6,613 . 2 1 ,198 . 2 1 ,532 . 1 ■ ,792 . 1 ■ ,570 . 31,249 . 1 . 1 . 1 . 1 . 1 1,081 1,307 1,595 1,753 2,978 A L FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 31 INTERNAL On the back of a granular distribution network I I I I 18 1 ~2,00,000 20 2 100+ State Rural Branches Urban Branches States UT Villages States UT Cities / Towns Madhya Pradesh 93 14 Maharashtra 30 19 .. Uttar Pradesh 89 11 Gujarat 62 13 Karnataka 200 10 • • • .... • • • West Bengal 116 12 I • •• • . Andhra Pradesh 2 10 • • •• • • I r · .. .. • • •••• Telangana 5 6 • • • • • "'• Haryana 41 7 • • • • • • • • ' • Rajasthan 62 8 • • •• • Bihar 366 8 • • • • • Punjab 45 4 • • • • • , • • Odisha 123 6 • • • Tamil Nadu 374 7 Kerala 92 3 Others 49 15 Pan India 1,749* 153 Total Branch Count: 206 (Rural –53, Urban –153) LTF Rural Network LTF Urban Network *RuralBranches comprise of Rural Group Loans & Micro Finance 32 Pincodewise location mapping meeting centres (1,696) and dedicated Farmer Finance branches (53) INTERNAL Leading to market dominance through fulcrum products Rural Group Loans and Micro Finance (JLG) - amongst the Leading Financiers Well diversified Operational Customer footprint excellence Centricity • Automated underwriting; geo-strategy • Vintage of 14+ years based on women credit penetration • LTF exclusive customers at ~40%# • 16 states across 300+ districts, ~1,700 • Culture of ‘0 DPD’ • Best-in-class TAT: 60 secs Meeting Centre Branches • Collection-led disbursement; CE @ 99.8% • Retention products – 70%* retention • ~1.4 Cr customer database • Collection route-map tracking • Optimum customer leverage; avg. o/s • Key states: Bihar, Tamil Nadu & • State of the art Risk Control Unit; on book ~Rs 36,500 /- Karnataka Compulsory bureau check Excellent Asset Quality; ~ Created Strong risk Conservative provisioning c::Y guardrails • Financier association limit – maximum 3 • No additional top-up loans for • Continued exposure checks & FOIR delinquent customers norms • 100% PCR on 90+ bucket • Internal & External DPD checks for fresh • Macro-prudential provisions & repeat customers • Customer profiling - on-us, off-us • Pincode selection basis PAR & customer leverage e l&T Finance 33 *on disbursals #on book INTERNAL Leading to market dominance through fulcrum products Farm Equipment Finance – amongst the Leading Financiers Well diversified Dealer / OEM Customer footprint Relationship Centricity • Vintage of 18+ years • Retention products (Kisan Suvidha) • 3,000+ Dealers • 170+ branches across 18 states & 1 UT • Financing adjacencies through • Analytics driven TA limits for top dealers • 11 lac+ customer database implement finance • Non-captive distribution franchise • Key states: Uttar Pradesh, Madhya • Paperless Digital Journey • Well penetrated across Top 5 OEMs Pradesh, Telangana, Karnataka • Best-in-class TAT: 24 hours ~ Operational Created Strong risk excellence guardrails • Water reservoir levels, Rainfall • Collection led disbursements; CE @ distribution 91.8% • State fiscal position • Analytics-based scorecard for • Farm cash cycle, MSP, sowing pattern decision-making • Tractor model / HP & other asset • Culture of ‘0 DPD’ variables e l&T Finance 34 INTERNAL Leading to market dominance through fulcrum products Two wheeler Finance - amongst the Leading Financiers Well diversified Dealer / OEM Customer footprint Relationship Centricity • Straddle continuum from New To Credit to Prime • Vintage of 10+ years • 6,500+ Dealers customers • 107 locations across India • Algorithm based preapproved TA for • Best-in-class TAT: 45 secs • 70 lac+ customer database top dealers • Paperless Digital Journey • Key states: West Bengal, • Non-captive distribution franchise • Innovative product offering Maharashtra, Gujarat • Analytics driven OEM cum Dealer • Sabse Khaas Loan & Income Proof loans - 1st in business model Industry • Building a sustainable franchise in EV financing ~ Operational Created Strong risk excellence guardrails • Customer profiling using lookalikes • Collection led disbursements; CE @ • OEM model variables 98.4% • Pincode selection basis multivariate • Straight through processing analysis • Culture of ‘0 DPD’ • Dealership performance e l&T Finance 35 INTERNAL Thereby creating a efficient cross-sell & up-sell franchise CUSTOMER LOAN 33% of PRODUCTS Rural Group Loans & Farm Equipment Two wheeler Finance disbursements are to pr H o o d o u k c t Micro Finance pr H o o d o u k c t Finance pr H o o d o u k c t & Home Loans / LAP Repeat customers ~1.4 Cr 11 Lac + 70Lac + Product penetration 4.0 per customer Pragati / Vishwas Loans Kisan Suvidha Personal Loan 16 products CROSS SELL & UP available for cross-sell SELL FRANCHISE Micro LAP Implement Finance Top Up Loan Rural Household Agri-allied Loans General Insurance Business Loans products General Insurance General Insurance Life Insurance products products products I Life Insurance products Harvesting our 2.2 Cr+ customer database 36 INTERNAL Built on the foundation of Data science based digital delivery Building Next-Gen platform & expanding scope Deepen existing and create new analytical models through harvesting of data PL TW HL RBF Farm SME Scorecards • • • • • • m ... Propensity Model (Sourcing / Collection) • • • • • , ..,::; , App Scorecard WIP • • • • • • ~ ,._~ Risk Control Triggers .: </ir • • • • • • Cross sell/ Up sell • • • • • • Bounce Prediction • • • • • X-Bucket Bounced WIP Customer Model • • "" ~ Normative Grid ~ ~I -/ ®' N.A. N.A. N.A. N.A. (asset based) • • • • r-Q~ Settlement Model WIP WIP 11~ .....: • e l&T Finance Live WIP Implemented during the quarter 37 INTERNAL Built on the foundation of Data science based digital delivery Leveraging data analytics across practices • Industry peer Benchmarking • State Fiscal Position • Soil Moisture Levels Sourcing • Market Penetration • Rainfall Distribution • Sowing pattern Analytics • Delinquency Trends • Water reservoir Levels • MSP / Mandi Prices • Collection Efficiencies • Agro-Climatic Zone • Cash & Harvest Cycle Underwriting Analytics Asset related Geographical Customer Behavioural Risk Control variables parameters variables data variables - A rh Collections 8-8 • • • Analytics Customer profiling Personalized Channel Right time & Segmentation treatment strategy of initiation for action e l&T Finance 38 INTERNAL …through assisted apps & centralized underwriting In the next phase, moved to developing assisted apps for customer loan delivery ASSISTED APPS PROVIDING END-TO-END DIGITAL LOAN JOURNEYS DIGITAL INTERVENTIONS KYC – DigiLocker / Account Aggregator – Rural Group Loans & Micro Finance Farm Equipment Finance Two wheeler Finance Aadhaar OCR / QR customer consent-based FI +- Route Map • • - +- Asset Details ~ ~ Upload Documents· C ... - 0DRIVINGUCENSE Selfie/Photo – AI – Machine Learning Model / - select 1-'romot,on 01nvoice S.swadRural 98hoq11MataMan Select Promotion 0Marginm°""yreceipt Liveliness / Face Match Scorecard Tenure(lnMonths)* QRTOReciep\ QNonKYCAdditionalAddre. . ProolR,....fUla, m KYCRaufUla I.ill Online Income Assessment / !JPhotoRaufUlla Invoice Amount Video KYC M1ruhTtmpltQ 1 ' Loan Amount Engine Number A Digital Income Computation V11rshw11 C M h a a n r, d g i a r 9 ll Margin Money Chassis Number Invoice Number -'""""9 0 Addlmplement ,. PROCEED Multi Bureau Check e-agreement Used by Field level officers for Sourcing, Disbursements & Collections Superlative Customer Exeperien ce l&T Finance 39 INTERNAL To deliver a best in class Customer Value Proposition LEVERAGING CUSTOMISED DIGITAL CAPABILITIES WITH THE INDIA STACK LEADING TO BEST IN CLASS TAT Liveness matching Digilocker, fuzzy logic & penny Video KYC With OCR as KYC credit 24 hours Industry avg: 4 days Farm Account Aggregator – customer AI in face deduplication AI in geo-spatial intelligence Equipment consent-based FI 60 secs eNACH e-Stamping e-Sign I Rural Group Loans & Micro Finance >>> u1 Auto population of customer API integration with channel 45 secs details – Image processing partners Industry avg: 10-15 min Two wheeler 18 mins Personal Industry avg: 90 mins Loan Reimagined credit Cloud-based 3rd party API Income estimation Application 20 mins models Infrastructure integration model scorecard Industry avg: 1 hour CENTRALISED AND DIGITAL UNDERWRITING Home Loan 40 INTERNAL To create a Fintech@Scale Fintech@Scale blueprint Components to building a Fintech@Scale • - - 1 Automated Process /G ~ ,I> • Qlik(& Scalability 2 ( ~eOoud _ v ___ . . ( ■ SFDC Workflow Google Cloud ■ I ~ -~ Googec~[ Platform ] ■ , ~Bus E -in n e g s i s n e R~ule I ~ ) Interactive ■ ~-~ _-a-_ Qlik& ( Qliksenseportals ] - ~ [ ~P~roce-ss- Fin~t~ech ~ L?J ( ] ■ Ecosystem Unified LOS • r ~ 4 ~C ustomer Journeys • Security 3 ] ~ [ ■ Cross-Sell ~ ( Customer ] ( I/, palo~It9.' ( Gen 5 Firewall ] ■ f) Engagement ■ 1 ~ ■ ( Insurance ] lg paloalto' ( AI-based security ] o-o assessment ■ mwom ~ . ( ] L) ~ IS ■ Servicing ~ e 1!9 ( ISO 27001 ] ~ -1 Certification ■ ■ Existing ■ Strengthen ■ Build Leverage deep fintech capabilities to achieve Lakshya goals & beyond 41 INTERNAL Index of Annexures I Our dominant Retail Franchise built over a decade II Financials III Other Annexures e l&T Finance 42 INTERNAL Lending Business – Business wise disbursement split Disbursement Q3FY23 Particulars (Rs Cr ) Q2FY24 Q3FY24 Y-o-Y (%) Farmer Finance 2,057 Farm Equipment Finance 1,534 2,027 (1%) Rural Business Finance 3,624 Rural Group Loans (JLG) 5,499 5,331 28% 657 Micro Finance (JLG) 242 144 Urban Finance 2,146 Two wheeler Finance 1,817 2,540 18% 1,228 Personal Loan 1,308 847 (31%) 1,074 Home Loans 1,356 1,512 41% 125 LAP 378 487 - 538 SME Finance 872 965 79% 160 Acquired Portfolio 494 678 - 11,607 Retail Finance 13,499 14,531 25% 1,444 Infrastructure Finance 178 318 (78%) 104 Real Estate Finance 20 16 (85%) 1,548 Wholesale Finance 198 334 (78%) 13,155 Focused Business 13,696 14,865 13% - De-focused - - - 13,155 Total Disbursement 13,696 14,865 13% 43 Consumer Loans has been renamed as Personal Loans INTERNAL Lending Business – Business wise book split Book Q3FY23 Particulars (Rs Cr) Q2FY24 Q3FY24 Y-o-Y (%) Farmer Finance 12,447 Farm Equipment Finance 13,351 13,845 11% Rural Business Finance Rural Group Loans & Micro Finance 17,485 21,672 23,110 32% (JLG) Urban Finance 8,716 Two wheeler Finance 9,518 10,447 20% 4,719 Personal Loan 6,481 6,427 36% 9,868 Home Loans 12,216 13,257 34% 2,645 LAP 3,038 3,397 28% 838 SME Finance 2,413 3,078 - 283 Acquired Portfolio 727 1,198 - 57,000 Retail Finance 69,417 74,759 31% 23,648 Infrastructure Finance 6,482 4,553 (81%) 7,362 Real Estate Finance 2,773 2,467 (66%) 31,010 Wholesale Finance 9,255 7,020 (77%) 88,010 Focused Business 78,672 81,780 (7%) 416 De-focused 62 - (100%) Consumer Loans has been renamed as Personal Loans 88,426 Total Book 78,734 81,780 (8%) 44 De-focused book is now NIL INTERNAL LTFH Consolidated – Summary financial performance Performance Summary ------- ----- 1,501 Interest Expense 1,325 1,353 1 (10%) ------------------------ -- ---- ---- - r ---- 80/o-- 1,693 NIM 1,729 1,833 318 Fee & Other Income 446 399 l[L ------- 26% __ 2,011 Total Income 2,175 2,232 11% ------------- 769 Operating Expense 860 894 16% 1,242 Earnings before credit cost 1,315 ----------------------------------------------------- t:: ::: 1---- 1 610 Credit Cost 517 ·::: (16~ : 632 PBT (Before Exceptional Items) 799 2,608 Capital Gain on sale of Mutual Fund --------82~. t __ -----~:-~. - [ Provisions on change in business 2,687 - - model l 553 PBT (After Exceptional Items) 799 s24 _______ 49% __ 1 454 PAT 595 640 41% - - ~~ ~ ~ Closing Book 90,652 Average Book 79,791 81,269 (10%) 21,019 Networth 22,185 22,860 9% e 84.8 Book Value per share (Rs) 89.3 l&T Finance 45 INTERNAL LTFH Consolidated – Key ratios Key Ratios Q3FY23 Key Ratios Q2FY24 Q3FY24 13.98% Yield 15.23% 15.60% 7.41% Net Interest Margin 8.62% 8.97% 1.39% Fee & Other Income 2.22% 1.95% 8.80% NIM + Fee & Other Income 10.84% 10.93% 3.37% Operating Expenses 4.29% 4.37% 5.44% Earnings before credit cost 6.56% 6.55% 2.67% Credit Cost 2.58% 2.52% 1.66% Return on Assets 2.42% 2.53% 4.10 Debt / Equity (Closing) 3.45 3.32 3.93 Debt / Equity (Average) 3.34 3.36 8.44% Return on Equity 10.81% 11.35% Particulars Tier I Tier II CRAR LTFH CRAR ratio 22.84% 2.09% 24.93% 46 INTERNAL LTFH Consolidated - Asset quality Consolidated – Asset Quality 0 0 0 60% 76% 75% 5,000 3,723 6% 4,000 4.21% 3,000 2,575 2,626 3.27% 3.21% 2,000 1,487 3% 1.72% 1,000 0.82% 627 648 0.81% 0 0% - Q3FY23 - Q2FY24 Q3FY24 GS3 (Rs Cr) NS3 (Rs Cr) GS3 (%) - NS3 (%) 0 PCR (%) e l&T Finance 47 Asset Quality numbers are based on EAD INTERNAL Index of Annexures I Our dominant Retail Franchise built over a decade II Financials III Other Annexures Asset Liability Management Sustainability (ESG & CSR) Board and Senior Management e l&T Finance 48 INTERNAL Astute Asset Liability Management OUTPERFORMING IN TIMES OF RISING INTEREST RATE ENVIRONMENT DIVERSIFIED LIABILITY MIX WEIGHTED AVERAGE COST OF BORROWING (WAC) 2% 5% 2% 8.08% 2% 3% Bank Loan - Non-PSL 2% 7% Bank Loan - PSL 7.50% 7.46% 27% 28% FI Loan NCD Private FY21 FY22 FY23 36% 40% 13% Retail NCD 19% CP 7% 6% ECB 7.71% 7.77% 7.79% 7.81% 7.47% 7.54% 7.34% 7.27% 7.33% Others Dec-22 Dec-23 Rs. 86,232 Cr Rs. 75,972 Cr Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 FY22 FY22 FY23 FY23 FY23 FY23 FY24 FY24 FY24 ‘AAA’ rating Prudent ALM along with changing Leveraged Priority Sector Bank CRISIL, ICRA, CARE, India portfolio mix towards retail Loans Ratings 49 Diversified liability mix has enabled to contain increase in quarterly WAC on sequential basis at 2 bps in Q3FY24 INTERNAL Prudent ALM - as on December 2023 Structural Liquidity statement 61,754 Cummulative Inflows (Rs. Cr) ■ 40,373 ■ Cummulative Outflows (Rs. Cr) 32,380 28,097 22,615 18,146 19,888 12,640 13,706 11,400 5,280 6,726 2,774 2,904 1-7 days 8-14 days 15 days-1 month 1-2 months 2-3 months 3-6 months 6-12 months Cumulative Positive 9,866 10,801 12,865 15,889 16,697 20,485 29,374 Gap Cumulative (%) 356% 372% 244% 236% 146% 103% 91% Interest Rate sensitivity statement 1 year Gap Rs. Cr Re-priceableassets 59,635 Re-priceable liabilities 46,471 Positive 13,164 Continue to maintain cumulative positive liquidity gaps e l&T Finance 50 INTERNAL AAA Credit Rating for LTFH Credit Ratings - LTFH • Rating Agencies reviewed the ratings of LTFH post merger and reaffirmed the ratings of LTFH at ‘AAA (Stable) / A1+’: Rating Agency Long-term / Short-term Rating of LTFH CRISIL Ratings CRISIL AAA (Stable) / CRISIL A1+ Ratings Update ICRA ICRA AAA (Stable) / ICRA A1+ India Ratings IND AAA (Stable) / IND A1+ CARE Ratings CARE AAA (Stable) / CARE A1+ Key strengths highlighted by Rating Agencies • Diversified business mix with strong presence across the financial services space • Strategic importance and strong support to financial services business by the parent, Larsen and Toubro Ltd. (L&T: AAA) • Strong resource raising ability and adequate capitalisation • Comfortable liquidity position e l&T Finance 51 INTERNAL Index of Annexures I Our dominant Retail Franchise built over a decade II Financials III Other Annexures Asset Liability Management Sustainability (ESG & CSR) Board and Senior Management e l&T Finance 52 INTERNAL L&T Finance – Businesses aligned with Sustainability goals RURAL : ~Rs 37,000 Cr Book Business deeply intertwined with ESG SDG Linkage 1,700+ Branches Penetrating underserved Reach Pan-India geographies Geo presence Active customers across ~2,00,000 Villages ~20,000 employees hired from Rural India Employment Generating sustainable livelihood Generation Field force Rural Group Loans & Micro Farm Agri Allied Micro Finance (JLG) LAP Equipment Stakeholder 3,000+ 60+ Promoting rural entrepreneurship Ecosystem Direct Direct Dealer Accredited Channels Partnerships Warehouses Moving communities from WOMEN Financing the FARMERS unorganized to organized ENTREPRENEURS underbanked & ~1.5 Cr underserved Enabling financial inclusion Customers Customers 100% Paperless journey Seamless Paperless 100% Digital disbursements Promoting doorstep banking journey 19% Digital Collections Digital SDG – Sustainable Development Goals 53 50% of the loan book franchise is towards financing sustainable livelihoods; 65% of workforce is employed from Rural INTERNAL ESG : Accelerating towards Lakshya (1/4) Retail | Digital | Sustainable Environment ~1,306 tCO2e emission avoided by switching to green power across L&T Finance Zero Waste to Landfill (corporate office) – External certified vendor empaneled for branches disposal of 3,460 kgs of waste (2,525 kgs of dry waste & 935 kgs of wet waste) Total of 25 Branches including HO converted to Green Power (36% of overall 3,315 kgs (Organizational) & 103 kgs (Daan Utsav) of E-waste recycled via consumption) authorized recycler First ~100% Renewable Energy operated branch in Tamil Nadu (Egmore) Initiatives on employee sensitization on food waste ~25,650 Electric Vehicles (EV) – Two wheelers financed Consumption of ~50% recycled paper in operations till Q3FY24 Certificate @.. CleanGeosphere 9 L&T Finance eCO e'- TECH 9 L&T Finance Prt. ..t •U•loe,I recycling OfE nvironmental Excellence Bin there, done that! ISO 45001: 2018&, 1S0/IEC 27001:2013 CERTIFIED Be mindful of your plate: THIS IS TO CERTIFY THAT Be a #GreenW'arrior by using vvaste <Crrtifirntr of ~-1.llnstr Disposnl We have Colle<=l9d 3460 kgs of Munic:ipal Solid WHte segregation bins! L&T F in m 0 a .C nc • e m l t l > o M ld 2 m 0 g 2 s 3 f L ro n m ni ted 'R.C 'J.;o.,::_: 1ll'2~-.2..!:J. 'luur'/).,,.-,~ Help us reduce food vvaste and create a sustainable workplace. Furti:ierlhiswast•isrecycledanddisposl-dasperthedirectionsoftha Munocip;,I Solid W,ste (Handling and Management) Rules 2016 6.2 Kg W• appreciate L&T Finance Holdinp.s Lum!ed !or providing us Yesterday's wastage was ______ anopportunitytomanag.elh&irwastaS<Jstainability. 'Tot11l,11wmi1yuuiv.-<1 _ __J .03~ 'KgsJ'J,,'ot. which can feed ___2_0___ people. © h1is bcn, rlispDstll 0JJ"1u ptr et11,ifomm,rrl frirmlly 111u1111rr, - Jimr SU/•porl will 11.-lp us lo gl'I" beftt•r f11t11r<' for tlu: (j/0/,1•. #start~o priya Sqnawane ~ORPORAT~ oon:;~ AOllfla~ 91~--.!IKC.~ - .CST_,,Ka,o,_-000~ ,;.-,1-n--1r .. ,- Noc1100•1,\11'1l1t--._...___,.,,., 54 ~~--""" o~ ,.. ....... ...-otrdrru,-ding.in INTERNAL ESG : Accelerating towards Lakshya (2/4) Retail | Digital | Sustainable Social • Launch of inaugural ‘Sustainable Finance Framework’ leveraging benefits of financial instruments Market l~telligence CRISIL & Analytics and sustainability Sustainable Finance Second Party • Framework independently reviewed and 2nd party opinion from CRISIL Opinion • Social financing pact with a leading Multilateral Bank for USD 125 million to support financing in Sustainable Fi•n ance Fra.m e. work L&T Finance Ho Idi•n gs L1m1ted rural and peri-urban areas in India particularly for women borrowers DE&I Sensitization & Awareness: 1) 10 dedicated workshops across 4 major locations covering 167 operational leaders 2) Separate session for 140 seniorleaders Occupational Health &Safety measures: 1) PAN India hybrid training on HIRA (Hazard Identification & Risk Assessment) by external expert covering different departments 2) Assessment carried out at 5 locations including HO to indetify the potential hazards and provide risk mitigation measures 3) Sensitization emailers to employees –1) Workplace ergonomics; 2) Air Quality Alert • Sale of handicrafts prepared by underprivileged women & persons with disability through stalls at a few company branch locations during festive season • Active women borrowers 63,53,789till date in FY24 e • Reached 9,00,000+ community members through CSR initiatives till Q3 FY24 l&T Finance 55 INTERNAL ESG : Accelerating towards Lakshya (3/4) Retail | Digital | Sustainable Governance ESG Ratings Enhanced transparency and strengthened governance by creating “One Single Lending Entity” ~CDP B Significant improvement from D to B Recognition as “Active Participation as Corporate Issuer on NSE Debt Platform” by NSE India Initiated tracking of ‘net promoter score’ for on boarding journey (Two Wheeler Loans) for assessing S&PGlobal S&P Global CSA Score - 50/93rd percentile customer satisfaction 1,66,112 of cyber threats identified & prevented till Q3 FY24 Continued to be in the “Low Risk” category Fraud prevention and awareness creation under ‘JankaarBaniye SavdhaanRahiye’campaign for employees and customers Sustainalytics a) Cyberbullying; b) Fake Apps; c) Online Survey frauds; d) Digital security andhabits MSCI • ESG RATINGS BBB Launch of ‘Sachet Awards’forpan Indiaemployees to drive fraud I ccc I a I BB I BBB D u lAul prevention culture within the organization e l&T Finance 56 INTERNAL ESG : Accelerating towards Lakshya (4/4) Retail | Digital | Sustainable Awards Champions of ESG Award at Global Fintech Mahatma Award for ESG Excellence UBS Forums Award under Sustainable Fest 2023 Sept’23 Organisation Award Sept’23 "U FAME Presented to L&T Finance umbai. Muhtua&bt. old A-war --· -~--•--~,.-.. ,- r-,,1n111(T.,.,.,-o.. Best Company in Sustainable CSR" Award Best “CSR Initiative" Award from Banking FAME National Award for "Women Empowerment" from Krypton Business Aug’23 Frontiers Aug’23 in NBFC industry Seept’23 l&T Finance 57 INTERNAL Corporate Social Responsibility Transforming Lives, Sustaining Progress • 9,00,000+ community members outreached under digital Sakhi project in Karnataka, Kerala, West Bengal, Odisha, Tamil Nadu, Uttar Pradesh and Bihar. • Enabled 1,00,000+ community members to access and avail benefits of banking services and government schemes • Digital Sakhi Podcast series highlighting success stories from ground zero (7 episodes) released Digital & Financial on various podcast platforms (Earshot, Spotify, Gaana, Apple Music, etc.). Inclusion • Digital Sakhi Project bagged 2nd Edition of India Sustainability Conclave and Award 2023 • Relief kits distributed to 10,000+ flood affected people in Chennai and Thoothukudi districts of Tamil Nadu. Disaster Management • Undertaken capacity building trainings of water user groups in 85+ villages in Maharashtra. • 3 Multi-Speciality Health Camps organized for tribal communities in Udaipur, Rajasthan benefited more than 500 people • Initiated a dedicated Road Safety awareness campaign for 2-Wheeler Riders in Delhi Other Initiatives • Created Road Safety awareness amongst 5,500+ school children in 10+ municipal schools of Mumbai. 58 INTERNAL Index of Annexures I Our dominant Retail Franchise built over a decade II Financials III Other Annexures Asset Liability Management Sustainability (ESG & CSR) Board and Senior Management e l&T Finance 59