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Bajaj Finance on fire, top contributor to Sensex rally as Q1 profit soars 159%

The company’s assets under management (AUM) crossed a milestone of Rs 2,00,000 crore in the quarter and stood at Rs 2,04,018 crore as of June 30, 2022, growing by 28 percent.

July 28, 2022 / 11:34 AM IST
Bajaj Finance

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Bajaj Finance share price spiked 9 percent intraday on July 28 a day after the company reported highest ever net profit in the quarter ended June 2022.

Shadow banking major Bajaj Finance on July 27 said its consolidated net profit for the quarter ended June was at Rs 2,596.25 crore, its highest ever, up 158.99 percent from Rs 1,002.44 crore in the same quarter of the previous year.

The number was higher than a CNBC- TV18 analysts' poll estimate of Rs 2435.8 crore.

The company said its net interest income (NII) for the quarter increased by 48 percent to Rs 6,638 crore from Rs 4.489 crore in the year-ago quarter.

New loans booked during the quarter grew by 60 percent to 74.2 lakh as against 46.3 lakh in Q1FY22. Customer franchise stood at 6.03 crore, registering a growth of 20 percent. The company recorded its highest ever quarterly increase in its customer franchise of 27.3 lakh in Q1FY23.

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The company’s assets under management (AUM) crossed a milestone of Rs 2,00,000 crore in the quarter and stood at Rs 2,04,018 crore as of June 30, 2022, growing by 28 percent.

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Here is what brokerages have to say about stock and the company post June quarter earnings

Citi

Research firm Citi has maintained buy rating on the stock with a target at Rs 8,400 per share.

The company reported healthy growth, but settling lower than past levels. The treasury management and pricing helps Net Interest Margin.

The key positive is continued traction in digital products, reported CNBC-TV18.

BofA Securities

Brokerage house BofA Securities has maintained buy rating on the stock with a target at Rs 8,345 per share on the back strong performance with beats on all key parameters.

The company is well-placed for strong growth revival, said BofA Securities.

The buy rating premised on growth with a strong capital buffer & AQ normalisation, reported CNBC-TV18.

Jefferies 

Brokerage house Jefferies has kept hold rating on the stock and cut target price to Rs 7,300 per share.

The company continue to deliver industry-leading 28 percent YoY rise in AUMs. The credit quality is also improving well and management aims to double AUMs in 3 years with high RoA.

The growth should stay strong and support premium valuation, reported CNBC-TV18.

CLSA

Broking firm CLSA has kept sell rating on the stock but raised the target price to Rs 5,600 from Rs 5,000 per share.

CLSA raises EPS estimates by 6-10 percent but valuation remains high. The healthy customer acquisition & growth driven by CD, rural & mortgage loans.

The strong asset quality & FY23 credit cost guidance lower than pre-COVID, however, valuation is largely in-line with pre-COVID levels, reported CNBC-TV18.

Morgan Stanley

Morgan Stanley has kept overweight rating on the stock with a target at Rs 8,000 per share.

Net Interest Income was a beat with comforting commentary has addressed Net Interest Margin concerns.

The consecutive quarters of 5 percent RoA should result in consensus upgrades, while unsecured consumer finance should make a strong comeback in FY23.

Morgan Stanley see a positive read-across to SBI Card, reported CNBC-TV18.

At 11:32 hrs Bajaj Finance was quoting at Rs 6,967, up Rs 573.25, or 8.97 percent on the BSE.

Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Moneycontrol News
first published: Jul 28, 2022 10:00 am
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