Buy Bajaj Finserv; target of Rs 18536: KR Choksey

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26 Aug, 2025 12:21

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KR Choksey's research report on Bajaj Finserv

Consolidated revenues for Q4FY22 stood at INR 188,617 Mn, a growth of 23% YoY. In Q4FY22, Consolidated PAT stood at INR 13,461 Mn, a growth of 37% YoY. Bajaj Finserv remains a debt free company. The surplus funds (excluding group investments) stood at INR 11.5 bn as on 31st March 2022 (INR 12 bn as on 31st March 2021) BAF’s PAT for Q4FY22 increased by 80% YoY (13.9% QoQ) to INR 24,200 Mn mainly on account of robust AUM growth, higher net interest income and better asset performance. BAGIC’s Profit After Tax (PAT) for Q4FY22 stood at to INR 2,480 Mn v/s INR 2,730 Mn in Q4FY21 (declined -18.4% QoQ). BALIC- Shareholders’ PAT during Q4FY22 stood at INR 480 Mn as against INR 2,340 Mn in Q4FY21 (INR 880 Mn in Q3FY22), impacted mainly due to higher new business strain and lower investment income.

Outlook

We have used the SoTP approach to arrive at a target of INR 18,536 per share (previously INR 19,674 per share); (3.0x P/EV for BALIC on FY24E EVPS; 2.5x P/B for BAGIC on FY24E; and 8x P/ABV on FY24E for BFL); indicating an upside potential of 29.4% over CMP. Accordingly, we maintain our “BUY” rating on the shares of Bajaj Finserv Ltd.

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