Geojit's research report on Bajaj Finance
Bajaj Finance Limited (BFL) is one of the leading non-banking financial companies (NBFC) in India. It is engaged in lending across retail, SME, and commercial customers and accepts public and corporate deposits. Q2FY21 AUM grew 1.1% YoY to Rs. 137,090cr. As of 30th Sep, the AUM under moratorium improved to 8.0% (15.7% in Q1FY21). Net Interest Income rose 4.0% YoY to Rs. 4,158cr. However, PAT slipped 35.9% YoY, as provisions rose to Rs. 1,700cr from Rs. 594cr in Q2FY20. As of 30th Sep, Capital adequacy ratio stood at 26.6%; Gross NPA/Net NPA at 1.03%/0.37%. The company’s strong liquidity position, capital preservation, opex management coupled with improved customer sentiments should drive growth in upcoming quarters.
Outlook
We reiterate our BUY rating on the stock with a revised target price of Rs. 3,760 based on 5.2x FY22E BVPS.
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