ICICI Direct's research report on Bajaj Finance
Bajaj Finance posted a steady set of numbers on the business and operational front with QoQ improvement in AUM, profitability being boosted by lower provisions. With high frequency risk, collections not warranting risk stance change guidance remains the same. Hence, it is a welcome sign. During the quarter, AUM growth on a sequential basis was at a multi quarter high of 6.5% at Rs 152947 crore led by 6.1% QoQ rise in mortgage book, while SME, consumer B2C and securities lending also showed respectable growth. The company during the quarter acquired 22.6 lakh new customers vs. 21.9 lakh QoQ and total customer franchisee for the quarter was at 4.8 crore representing growth of 14% YoY. The quarterly new customer addition was within their general guidance of 70-80 lakh new customer acquisition in a year.
We believe premium multiples will be maintained for Bajaj Finance and accordingly value the stock at 6.7x FY23E. We maintain target price of Rs 5900. We maintain BUY rating.