Motilal Oswal's research report on Bajaj Finance
Bajaj Finance (BAF)’s FY22 Annual Report provides insights into the nuts and bolts of its omni-channel strategy, which aims to make it easier for customers to move seamlessly between online and offline channels. Through this, the company is confident of achieving higher business velocity, streamlining processes, constructing a leaner cost structure, and gaining a greater wallet share among its customer franchise. This year, the company continued to focus on creating a risk managed superior quality portfolio by diversifying across borrowers, product categories, and geographies. It has delivered a healthy performance in FY22 through (a) capital management (Tier I of ~25%), (b) conservative liquidity buffer (~9% of average borrowings in FY22), (c) expansion of collections and servicing capabilities, (d) a strong underwriting ability, and (e) significant progress on multiple domains of its omni-channel, thereby, further strengthening its risk management abilities.
Outlook
We reiterate our BUY rating on the stock. We reiterate our Buy rating, with a revised TP of INR8,100 (7.75x FY24E BVPS).
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