Bajaj Finserv on April 28 reported a five-fold jump in the March quarter consolidated profit at Rs 979 crore, driven by the insurance business, against Rs 194 crore in the same quarter last year. The profit on a sequential basis fell 24.1 percent.
The consolidated profit figures for the current quarter and year may not be directly comparable with those of the corresponding periods, the company said.
"Under Ind AS, the insurance subsidiaries have chosen to hold a large part of the equity securities portfolio as fair value through profit and loss account. The spread of the COVID-19 pandemic resulted in a significantly larger than normal fall in the value of shares traded on the stock exchanges in Q4 FY20. As on March 31, 2021, the BSE Sensex has rebounded by over 68 percent from March 31, 2020 levels, resulting in higher than normal mark-to-market gain on investments or insurance subsidiaries during FY21. This has resulted in an increase in consolidated profit after tax of Rs 892 crore for FY21 compared to a decrease of Rs 451 crore in Q4 and FY20. The mark-to-market adjustment for Q4 FY21 was not significant," the company said.
Consequent to the pandemic, Bajaj Finance has, as a matter of prudence, written off /provided for principal and interest of potentially unrecoverable loans by also utilising the available expected credit loss provision, said Bajaj Finserv, adding it continued to hold a management overlay of Rs 840 crore in provisions, given the dynamic and evolving nature of the pandemic along with other variables.
Bajaj Finance's profit increased by 42.1 percent year-on-year to Rs 1,347 crore, life insurance business registered a 515.8 percent year-on-year growth in profit at Rs 234 crore but general insurance business' net fell 10.2 percent to Rs 273 crore in Q4FY21.
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Bajaj Finserv reported a 15.7 percent growth in the topline at Rs 15,387 crore compared to the year-ago period but it declined 3.6 percent sequentially.
In the financial year FY21, consolidated profit grew by 32.7 percent to Rs 4,470.46 crore and topline jumped 11.5 percent to Rs 60,591.57 crore compared to previous year.