L&T Finance : LTF Integrated Annual Report FY2023-24

Corporate Information

Board of Directors

S. N. Subrahmanyan

Non-Executive Director and Chairman

Sudipta Roy

Managing Director and Chief Executive Officer

R. Shankar Raman

Non-Executive Director

Thomas Mathew T.

Independent Director

Rajani R. Gupte

Independent Director

1. Seetharaman
   Independent Director

Nishi Vasudeva

Independent Director

Pavninder Singh

Nominee Director

Company Secretary

Apurva Rathod

Details as on the date of issue of the Report

Statutory Auditors

M/s KKC and Associates LLP (formerly known as Khimji and Kunverji and Co. LLP)

Registered Office and Investor Service Centre

Brindavan, Plot No.177, C.S.T. Road,

Kalina, Santacruz (East),

Mumbai - 400098,

Maharashtra, India

Phone: [phone]

Fax: [phone]

Website: www.ltfs.com

Email: [e-mail]

Registrar and Share Transfer Agents

Link Intime India Private Limited

C-101, 247 Park, L.B.S. Marg,

Vikhroli (West), Mumbai - 400083,

Maharashtra, India

Phone: [phone]

Fax: [phone]

Website: www.linkintime.co.in

Email: [e-mail]

Investor Information

Market Capitalisation as on March 31, 2024	₹ 39,362.59 Cr
BSE Code	533519
NSE Symbol	LTF
AGM Day, Date and Time	Tuesday, June 25, 2024 at 10.00 a.m. (IST)
AGM Mode	Video-Conference/OtherAudio-Visual Means

Across The Pages

Corporate Overview	02-27
About the Report	03
Who We Are	06
Performance Highlights	14
Chairman's Message	20
Managing Director and
Chief Executive Officer Message	24
Management Discussion and Analysis	28-61
Sustainability Performance	62-335
Value Creation	62
Stakeholder Engagement and Materiality Assessment 84
Corporate Governance	120
Financial Capital	148
Manufactured and Intellectual Capital	166
Human Capital	186
Social and Relationship Capital	212
Natural Capital	244
Business Responsibility and Sustainability Reporting	262
Assurance Statement	314
GRI Content Index	323
TCFD Disclosure	333
Policy Compendium	334
Statutory Reports	336-392
Board's Report	336
Corporate Governance Report	365
Financial Statements	393-653
Standalone	393
Consolidated	554
Notice	654-670
Glossary	671-673

EMPOWERING

WITH

TECHNOLOGY

BUILDING FUTURES

Digital growth is not just a tale of technological advancement, but also one of empowerment, inclusion, and resilience. At the heart of a digital journey, lies the vision of leveraging technology to drive socioeconomic development and bridge the digital divide. As the country navigates the opportunities and challenges of the digital age, its commitment to leveraging technology for the benefit of all remains unwavering.

L&T Finance takes cognizance of this technology wave and is committed to becoming one of the most pre-eminent technology driven lenders. Our technology efforts are divided

into 4 quadrants, namely designing superior customer experience, digital process engineering, augmenting IT infrastructure and strengthening information security. These efforts are directed towards agile and customer-focussed delivery on the 5-Pillars of the execution engine to create a sustainable and predictable retail franchise.

Through the adoption of artificial intelligence and automation, combined with our lending prowess, we empower people to dream big and build futures.

This report delves into our amplified technology journey and our delivery on the

execution pillars demonstrated through the business growth. Additionally, as a responsible corporate citizen, we have taken bold strides in areas of social responsibility and sustainability. All these initiatives clearly indicate that we are on the right path to becoming a sustainable Fintech@Scale.

Empowerment with the use of technology will truly build futures!

2	Integrated Annual Report 2023-24

Corporate	Statutory	Financial
Overview	Reports	Statements	Notice

About the Report

At L&T Finance Limited (formerly known as L&T Finance Holdings Limited) and its subsidiaries, collectively referred to as LTF or your Company, a paramount focus has been placed on delivering products and services sustainably to its customers. Your Company embraced the Lakshya 2026 strategy in FY22 and achieved it well in advance in FY24, with a stronger technological shift and a customer-centric approach. Going forward, LTF will continue to focus on making its organisational performance consistent, predictable and sustainable by adopting the following 5 key pillars of execution:

Sharpening Credit	Heightened Brand
Underwriting	Visibility

Enhancing Customer	Implementing Futuristic	Capability
Acquisition	Digital Architecture	Building

Upholding the values of transparency, accountability and commitment to stakeholder value, your Company has consistently disclosed its performance across its operations and businesses annually through Sustainability and Integrated Reports since FY19. LTF aims to provide a comprehensive overview of both, financial and non- financial performance during FY24 through this Integrated Annual Report ("the Report"). The Report is designed to present stakeholders with a holistic perspective of your Company's ambitions, strategic approach, goals, performance, impact, and future direction.

L&T Finance Limited	3

Reporting Principle

The financial and statutory data presented in the report is in line with the requirements of the Companies Act, 2013 ("the Act") (including the rules made thereunder), Indian Accounting Standards, the Companies (Accounting Standards) Rules, 2006, the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Listing Regulations") and other applicable RBI regulations.

The non-financial information in the Report has been prepared in accordance with the framework of the International Integrated Reporting Council (IIRC) and provides Key Performance Indicators (KPIs) across the Six Capitals. It provides sustainability disclosures as per the Global Reporting Initiative (GRI), 2021 Standards for the period from April 1, 2023, and/or as on March 31, 2024 or as specified in the Report.

Furthermore, the Report is aligned with the National Guidelines on Responsible Business Conduct (NGRBC), Business Responsibility and Sustainability Reporting (BRSR) requirements prescribed by the Securities and Exchange Board of India (SEBI), the United Nations Sustainable Development Goals (UNSDGs) and the Taskforce

on Climate-related Financial Disclosures (TCFD).

4

Scope and Boundaries

The Report covers the disclosures for the period from April 1, 2023, and/or as on March 31, 2024, or as specified in the Report. The data and content in the Report aim to provide an accurate and balanced economic, social, and environmental performance of LTF's Head Office ("HO") and 1,964 branches, including closed branches. The reporting boundary of the Report is as disclosed in Question 13 and Question 23 (a) of Section A: General Disclosures of the BRSR.

The scope and boundaries for each material topic and metrics are detailed either in the text where the topic is introduced, or by references to the LTF website and public documents. Nos. wherever required, have been rounded off.

Precautionary Principle

LTF adopts a precautionary approach in risk management and lending decisions to mitigate any adverse social and environmental impacts. Principles such as stakeholder inclusiveness, completeness and materiality were followed while preparing this report. The same is enumerated across various sections of the Report.

Materiality and

Target Audience

As one of the leading NBFCs, LTF has a direct economic, social, and environmental impact, and a significant indirect impact through its financial activities. In compiling the Report, the topics that could have a material impact on the stakeholders are accounted for, including business and management systems. Other relevant matters are also encapsulated in the 'Value Creation Model'.

LTF continuously takes the views and opinions of stakeholders and aligns its execution/strategy and reporting to meet evolving expectations. For materiality analysis, stakeholder groups (internal as well as external) were consulted in a qualitative and quantitative manner.

The report is crafted to communicate your Company's progress to the varied groups of stakeholders

who have an influence on or are affected by LTF. These groups encompass Employees, Investors, Regulators, Customers, Vendors, CSR Project Implementing Partners and Communities. The primary objective is to provide stakeholders with a perspective of your Company's businesses and the capacity to create and sustain value.

Integrated Annual Report 2023-24

Corporate	Statutory	Financial
Overview	Reports	Statements	Notice

Corporate Restructuring: 'Single Lending Entity'

Effective December 4, 2023, your Company successfully completed the merger of its subsidiaries, L&T Finance Limited, L&T Infra Credit Limited and L&T Mutual Fund Trustee Limited ("Merged Entities") with itself. With this merger, all the lending businesses are now housed under one single entity i.e., your Company, with it becoming the equity and debt listed operating lending entity.

The merger was an internal restructuring exercise and resulted, inter alia, in the transfer and vesting of the assets, liabilities and the entire undertaking of the Merged Entities into your Company, followed with the dissolution, without winding up, of each of the Merged Entities. The process was completed post requisite shareholders', creditors' and regulatory/statutory approvals. The merger has led to the creation of a simplified 'Single Lending Entity'.

Further, with effect from March 28, 2024, the name of your Company has changed to L&T Finance Limited.

L&T Finance Limited

Forward-Looking

Statements

The Integrated Annual Report incorporates forward-looking statements pertaining to LTF's anticipated performance and future events, articulated through terms such as 'plans', 'expects', 'will', 'anticipates', 'believes', and 'intends'. Recognising the inherent uncertainty and risks associated with these assumptions and predictions, your Company emphasises its disclaimer of any obligation to update such statements post-publication. Stakeholders are urged to exercise prudence and refrain from undue reliance on these statements, given that actual future outcomes may significantly deviate due to various external factors beyond your Company's control, introducing an element of unpredictability.

Assurance

The information in the Report has been subjected to a thorough internal validation process and a robust assurance procedure, harnessing both your Company's internal expertise and external validation conducted by Deloitte Haskins and Sells LLP, an independent third-party assurance provider renowned in the professional sphere. An assurance review has also been conducted on the Report, adhering to SSAE 3000 Assurance Standards. The corresponding Assurance Statement forms a part of the Report.

For ease of information access, links are embedded to relevant pages on your Company's corporate website and the Report. Any questions or feedback on the Report can be sent to us by writing to [e-mail].

5

Who We Are

LTF is one of the leading Non-Banking Financial Companies ("NBFC") which provides a diverse range of financial products and services. Headquartered in Mumbai, LTF has secured the highest credit rating- 'AAA', from 4 leading rating agencies. Additionally, your Company has received top-notch ESG Ratings for its performance on sustainability. LTF operates across a wide network of branches pan India, ensuring accessibility to people having diverse financial needs across varied geographies. Your Company actively drives financial inclusion by extending its products and services to society's financially excluded and marginalised sections.

Your Company is deeply committed to upholding the legacy of its parent company, Larsen and Toubro Limited (L&T). The L&T Group, a respected name in India's private sector for over eight decades, is characterised by professionalism and high standards of corporate governance. L&T is engaged in core, high-impact sectors of the economy and integrated capabilities that span the entire spectrum of 'design to delivery'. L&T has also played a vital role in significant projects of national importance such as the Ayodhya Ram Temple, ISRO's Chandrayaan 3 mission, the Statue of Unity, Kempegowda International Airport and the Mumbai Trans Harbour Link, among others.

Built on the Foundation of Trust and Commitment

AAA

Part of the	Upper Layer	Amongst Top	Highest Credit	Top-Notch
illustrious L&T	NBFC as per RBI	Retail NBFCs	Rating - 'AAA'	ESG Ratings
Group	classification

6	Integrated Annual Report 2023-24

Corporate	Statutory	Financial
Overview	Reports	Statements	Notice

Vision

1 LTF envisions to be an admired and inspirational financial institution, creating sustainable value for all stakeholders

	Values
1	Ambition: LTF aspire to
	achieve something more
	and doing better than it did
	yesterday.
2	Pride: Confidence in LTF's
	abilities as a stable and
	sustainable organisation
	that always contributes to
	the customer and every
	stakeholder.
3	Discipline: Creating a culture
	of results and not reasons, LTF
	places responsibility on doing
	what is right day after day
4	Integrity: Integrity beyond
	honesty, including focus,
	consistency

	Sustainability
	Commitments
1	Become Carbon Neutral
	(Scope 1 and 2) by 2035
2	Maintain Water Positive/
	Surplus status
3	Achievement of the set
	Sustainability targets

LTF became a publicly listed company in 2011, three years after its inception. Your Company has received a Certificate of Registration (CoR) as a Non-Banking Financial Company Core Investment Company (NBFC-CIC). However, pursuant to the merger, the Company, being the surviving entity, has applied for CoR as NBFC-ICC, and complies with the guidelines applicable to a NBFC-ICC, pending receipt of the CoR from RBI.

LTF has its shares and debt securities listed on the Stock Exchanges in India.

L&T Finance Limited	7

Board of Directors

Committee Membership

Expertise and Competencies

Committee Membership

Expertise and Competencies

	February	64 years
S. N. Subrahmanyan
28, 2022	Indian

Chairman and

Non-Executive Director

N.A.

Leadership Qualities, Financial Sector Knowledge and Experience, Exposure in Policy Shaping and Industry Advocacy, Understanding of the Regulatory Framework, Corporate Governance, Financial Expertise, Risk Management, Global Experience/International Exposure, Information Technology & Cyber Security, Sustainability/ESG Expertise

Full profile accessible at: https://www.ltfs.com/about-us

Sudipta Roy	January	52 years
24, 2024	Indian
Managing Director and
Chief Executive Officer
Asset Liability Management	Stakeholders' Relationship and
Committee (Chairman)	Customer Protection Committee
Corporate Social Responsibility and	Risk Management Committee
ESG Committee	IT Strategy Committee

Leadership Qualities, Financial Sector Knowledge and Experience, Exposure in Policy Shaping and Industry Advocacy, Understanding of the Regulatory Framework, Corporate Governance, Financial Expertise, Risk Management, Global Experience/International Exposure, Information Technology & Cyber Security, Sustainability/ESG Expertise

			Full profile accessible at: https://www.ltfs.com/about-us
	Date of appointment	Age	Nationality
	8		Integrated Annual Report 2023-24