Bajaj Finance Q2 net up 48% to Rs 130 cr

Moneycontrol Bureau

Aided by a strong loan growth and fee income, Pune-based non-banking finance company -- Bajaj Finance on Friday reported 48% year-on-year jump in its second quarter (July-September) net profit at around Rs 130 crore. The net interest income (NII) or the difference between interest earned and paid out, climbed 36% y-o-y to Rs 442 crore.

Total assets under management (AUM) expanded 53% to Rs 15,370 crore while loan disbursements rose 29% to Rs 4,334 crore. Most of the credit growth came from small and medium enterprises, which ballooned at the highest pace of 67% at Rs 1,410 crore. The consumer book (wherein company gives loans to the affluent class to buy white good products as well as two/three wheeler) grew 33% to Rs 2,112 crore.

The fee income rose 49% to Rs 737 crore. The company generates fee income from three sources: credit card selling (co-branded with Standard Chartered Bank), out of volume for lending and insurance fees.

However, it brought down its exposure to commercial segment (including construction equipments, infrastructure loans and vendor financing). In the division, loans contracted by 12% y-o-y to Rs 811 crore. This is the second consecutive quarter that the NBFC reduced its commercial book.

The net non-performing asset ratio stood improved at 0.20% as against 0.30% in the corresponding quarter of the previous year. Net NPA ratio is generally derived at after deducting loan provisions from gross NPAs.

Also read:  Infra lending to de-grow by 8% in FY13: Bajaj Finance

Meanwhile, loan losses and provisions shot up 20% to Rs 53. The provisioning coverage ratio remained unchanged at 80%.

"The company continues to provide for loan losses in excess of RBI requrements. During the quarter, the company took an accelerated provision of Rs 14 crore as against Rs 5 crore in the corresponding quarter of the previous year. Excluding the accelerated provision, the loan loss provision was flat at Rs 39 crore," the company wrote in a press release.

Meanwhile, the quarterly numbers were below the market expectations, although the disbursal growth was largly as per the Street estimates.

"BAF barely met street expectation with PAT of Rs129 crore v/s our expectation of Rs 142 crore and consensus PAT of Rs136 crore. The difference to our bottom line estimate was driven by higher provisions. Operating profit was in-line, just 1.6% below expectation," said Nilanjan Karfa, a banking analyst from Brics Securities.

saikat.das@network18online.com