Prabhudas Lilladher is bullish on Bajaj Finance has recommended buy rating on the stock with a target price of Rs 4668 in its research report dated October 22, 2019.
Prabhudas Lilladher's research report on Bajaj Finance
Maintaining robust growth trajectory, NII at Rs39.9bn (PLe: Rs38.8bn) grew strong 48% YoY exceeding AUM traction of 38% YoY for Q2FY20. While business seasonality led to sequential decline in customer addition at 1.9mn, such a run-rate still stands higher vis-à-vis historical 1.5mn. BAF's unique customer franchise (now 39mn) backed by existing customer base that formed 70% of incremental acquisition only continues to get better. Such a healthy core book performance translated into robust PPoP at Rs 26.2bn (PLe: Rs 25.1bn) growing 50% YoY/9% QoQ. BAF recorded one-time marginal gains to the tune of Rs10mn arising out of tax adjustments under new regime. Subsequently, PAT at Rs 15.1bn [ PLe Rs13bn] increased 63% YoY/26%QoQ.
Consequently, BAF remains poised to deliver 21.0% ROEs/3.5% RoAs by FY22E. We reiterate BUY rating on the stock valuing Co. at 6.6x PABV Sep'21 estimates arriving at price target of Rs 4,668 (earlier Rs4,681).
For all recommendations report, click here
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