Both the insurance companies of Bajaj Finserv have shown strong topline performance compared to the previous quarter though it's the second successive quarter of decline in life insurance profit growth. Bajaj Allianz Life Insurance Company Limited and Bajaj Allianz General Insurance Company Limited are engaged in life and general insurance business respectively
Bajaj Allianz Life Insurance Company Limited and Bajaj Allianz General Insurance Company Limited are engaged in life and general insurance business respectively. Bajaj Finance is key subsidiary of Bajaj Finserv and is a Non-Banking Finance Company engaged in consumer finance, SME finance and commercial lending and wealth management.
To decode the numbers, CNBC-TV18 spoke to Sanjiv Bajaj, MD, Bajaj Finserv.
Talking about the sequential decline, he said a large part of Bajaj Finance business is consumer lending and cannot be compared quarter or quarter. He said the Q1 and Q3 are big quarter for the business. Q3 because of festive season and Q1 because of wedding season.
He further said of their four lines in Bajaj finance – consumer, rural, SME and commercial, SME is a segment where they have been cautious because they have not seen the same level of interest on the ground. SME business in Q2 grew only 18 percent.
Talking about cross-sell products, he said the company engages in multiple products in this segment and personal loan to existing customers was the first cross-sell opportunity that they started almost 8 years ago. It is basically a fee income business for the company, said Bajaj.
In addition to personal loans, they also cross-sell insurance and credit report services.
When asked how the rural segment was doing, he said the company was seeing a robust rural demand. Currently, they have 900 branches in rural and semi-urban India and would be adding couple of hundred more every year, he said, adding that they started focusing on rural market around four years ago. According to him, with the pace at which India is growing it would attract more competitors into consumer lending.
In the same interview he also spoke about the benefits of Analytics and Big Data and how they have managed to bring down the costs. Bajaj said they would be at the forefront in terms of analytics in the NBFC sector.
For the full interview, watch video
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