India's largest non-banking lender, Bajaj Finance on April 25 reported 21 percent growth in its consolidated profit after tax to 3,825 crore in the fourth quarter of the financial year 2023-24 from Rs 3,158 crore in the year-ago period.
Consolidated numbers include the businesses of the lender's subsidiaries, Bajaj Housing Finance and Bajaj Financial Securities.
Net profit beat analyst estimates. Analysts predict a 22 percent year-on-year jump in net profit, led by credit growth but caution that higher cost of funds could dampen the margin outlook.
According to an average estimate of five brokerages polled by Moneycontrol, Bajaj Finance's net profit was expected to rise 22 percent to Rs 3,836 crore in Q4FY24 from the year-ago period.
The net profit of the company has increased on the back of rising assets under management, net interest income and improvement in the asset quality.
In the reporting quarter, company's Assets under management (AUM) grew by 34 percent to Rs 3.31 lakh crore as of March 31, 2024 from Rs 2.47 lakh crore as of March 31, 2023. AUM grew by Rs 19,647 crore in Q4FY24.
Net interest income increased by 28 percent in January-March quarter, to Rs 8,013 crore from Rs 6,254 crore in in a similar period.
Net total income increased by 25 percent in Q4FY24 to Rs 9,714 crore from Rs 7,775 crore in Q4FY23.
Gross NPA and Net NPA as of March 31, 2024 stood at 0.85 percent and 0.37 percent, respectively, as against 0.94 percent and 0.34 percent as of March 31, 2023.
The Company has provisioning coverage ratio of 57 percent on stage 3 assets and Capital adequacy ratio (CRAR) (including Tier-II capital) as of March 31, 2024 was 22.52 percent. The Tier-I capital was 21 .51 percent.
The NBFC declared a dividend of Rs 36 per equity share of Rs 2 face value.
Bajaj Finance said it has made required changes in response to the regulatory restriction imposed by RBI on the Company, on sanction and disbursal of loans under 'eCOM' and 'lnsta EMI Card'. The company has formally requested RBI for a review and removal of these restrictions.
On November 15, 2023, the Reserve Bank of India directed Bajaj Finance to stop sanction and disbursal of loans under its two lending products ‘eCOM’ and ‘Insta EMI Card’, with immediate effect.
The RBI said that this action is necessitated due to non-adherence of the company to the extant provisions of Digital lending guidelines of the central bank, particularly non-issuance of Key Fact Statements to the borrowers under these two lending products and deficiencies in the Key Fact Statements issued in respect of other digital loans sanctioned by the company.
Number of new loans booked grew by 4 percent in Q4FY24 to 7.87 million as against 7.56 million in Q4 FY23. The new loans booked during the quarter were lower by approximately 0.80 million on account of the restrictions placed by the RBI on the Company, on sanction and disbursal of loans under 'eCOM' and 'lnsta EMI Card'.
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