In a significant move to expand its portfolio, L&T Finance Ltd. (LTF) has successfully completed the acquisition of the gold loan business of Paul Merchants Finance Private Limited (PMFL). The transaction, finalized on June 9, 2025, marks LTF’s strategic entry into the gold loan sector. This acquisition aligns with LTF’s broader goal of enhancing its secured loan offerings and strengthening its position as a leading Non-Banking Financial Company (NBFC) in India.
Overview of the Acquisition
The acquisition was executed as a slump sale on a going concern basis, transferring PMFL’s gold loan business to LTF for a lump sum consideration. The deal includes
- 130 branches of PMFL.
- Approximately 700 employees.
- A gold loan book valued at Rs. 1,350 Crore.
This move not only diversifies LTF’s product portfolio but also provides immediate access to PMFL’s established customer base and operational infrastructure.
Strategic Rationale Behind the Acquisition
Expanding Product Offerings
LTF’s acquisition of PMFL’s gold loan business fills a critical gap in its portfolio. Gold loans are secured, high-yield products that cater to both rural and urban customers. By adding this product, LTF enhances its ability to serve a broader demographic, particularly in rural areas where gold loans are a popular financial instrument.
Leveraging Existing Rural Franchise
LTF boasts one of the largest rural customer bases in India, with approximately 1.6 crore rural customers and a workforce of 20,000 feet-on-street employees. This existing infrastructure provides a ready platform to cross-sell gold loans, ensuring rapid adoption and growth of the newly acquired business.
Synergistic Growth
The acquisition aligns with LTF’s philosophy of risk-calibrated inorganic growth. By integrating PMFL’s gold loan business, LTF addresses a capability gap while ensuring seamless integration due to compatible business models and employee profiles.
Leadership Perspectives
Sudipta Roy, MD & CEO of LTF
Mr. Roy emphasized the strategic importance of this acquisition:
“The gold loans business will fill a crucial gap in our portfolio, introducing a secured, high-yield product that will benefit both our rural and urban customers. This acquisition is not just about expanding our offerings; it’s about solidifying our position as a comprehensive financial partner for our customers across the country.”
He also highlighted the immediate benefits of leveraging LTF’s rural workforce to generate gold loan leads, giving the company a competitive edge.
Sat Paul Bansal, Chairman and MD of PMFL
Mr. Bansal expressed confidence in LTF’s ability to sustain and grow the gold loan business:
“We are proud to have built a strong, compliant, and customer-centric gold loan business undertaking, and we believe that LTF is the ideal partner to take this legacy forward.”
Impact on Stakeholders
Customers
Existing customers of PMFL’s gold loan business will now benefit from LTF’s extensive network and financial expertise. The transition ensures continuity of service while offering access to a wider range of financial products.
Employees
The approximately 700 employees transitioning to LTF will join a company known for its strong workplace culture, as evidenced by its Great Place To Work® certification. This move provides career stability and growth opportunities within a larger organization.
Investors
For investors, this acquisition underscores LTF’s commitment to growth and diversification. The addition of a high-yield product like gold loans is expected to enhance profitability and shareholder value.
LTF’s Vision and Future Plans
Lakshya 2026 Strategy
The acquisition is a step forward in LTF’s Lakshya 2026 plan, which aims to transform the company into a top-class, digitally enabled retail finance firm. Key pillars of this strategy include:
Customer Focus: Shifting from product-centric to customer-centric operations.
- Fintech@Scale: Leveraging technology to enhance service delivery.
- ESG at the Core: Maintaining a strong focus on environmental, social, and governance practices.
Digital and Financial Inclusion
LTF’s flagship CSR project, Digital Sakhi, highlights its commitment to women’s empowerment and financial inclusion. The gold loan business will further this mission by providing accessible financial solutions to underserved segments.
Conclusion
The completion of L&T Finance Ltd.’s acquisition of PMFL’s gold loan business marks a pivotal moment in the company’s growth trajectory. By entering the gold loan market, LTF not only diversifies its product offerings but also strengthens its rural and urban presence. The strategic fit, combined with LTF’s robust infrastructure and customer base, positions the company for sustained success in this new segment.
As LTF continues to execute its Lakshya 2026 vision, this acquisition exemplifies its commitment to innovation, customer-centricity, and responsible growth. Stakeholders—customers, employees, and investors alike—can look forward to the tangible benefits of this strategic move in the coming years.
Did you find this article interesting?
Stay connected with our blog for more insights and updates. We’d love to hear your thoughts, questions, or feedback in the comments below!
