L&T Finance fires over 500 employees citing poor performance

Leading non-banking lender L&T Finance Holdings, which used to have major presence in rural areas but has of late been scaling down exposure to the distress in the hinterlands, has given pink slip to over 500 employees.

Company chairman and managing director Y M Deosthale termed the sacking as "separation of staff from across the sectors based on their poor performance".

He also warned of more stress in the rural areas. "We may see some stress in the farm sector for the next five to six months. The situation may improve only in the second half of the year, that too if there is normal monsoon," he said.

"What we have done is that we reviewed their performance and based on which slightly more than 500 employees have been separated from across the sectors which include retail, rural and other segments," Deosthale told PTI.

He pointed out that the rural sector was facing a lot of stress due to consecutive failure of monsoon, and being a major player in these markets, especially in farm equipment finance, the company has been scaling down operations.

Drought in many parts of the country had left many farmers unable to repay loans. While demand for tractors had come down, the farmers' ability to repay loans has also diminished, he said.

Asked whether the company will reduce its lending rates, he said loan pricing has already fallen last fiscal. "I do believe that it may further come down by 50-60 basis points over next few months," Deosthale said.

The company on Monday reported 15% rise in consolidated net income at Rs 237 crore for the March quarter, driven by retail and wholesale advances. Income from operations grew 19.77% to Rs 1,957.96 crore, while total disbursements jumped 20% to Rs 10,688 crore.