Bajaj Finance Ltd competes for top positions in India’s financial services market, concentrating on retail lending. As a member of the Bajaj Finserv’s Group, it has positioned itself as an authority in the consolidation and distribution of diverse financial products.
Bajaj Finance has a focus on financing two wheelers, consumer durables, PCs and personal loans. Besides that, the firm provides insurance services and has recently started offering IPO financing to high net worth individuals.
In alignment with its strategic mission, Bajaj finance is constantly broadening its scope portfolio. New physical connectors are being given on the target audience which is not only about expanding the consumer base but also about expanding geographical coverage in semi urban and rural areas. This strategy not only broadens its product line but also reinforces its status as a one stop financial shop in India.
As at 3:30 PM GMT+5:30, the stock price of Bajaj Finance Limited (NSE: BAJFINANCE) closed at INR 7,022.50 which is an increase of 111.15 point (1.61%). The upward trend is caused by favorable expectations towards the performance of the firm in future.
Market Capitalization: Around INR 4.348 trillion. This great market cap position gives Bajaj Finance strong footing in the financial market.
Beta (5Y Monthly): 1.01, suggests that the level of market activity for this stock is similar to the average market movement.
PE Ratio (TTM): 28.25, elucidates on the price per unit earnings which is hinged on how much the investor is ready to pay for the business. Investors can expect a lot if the PE ratio is high.
EPS (TTM): 248.81, defines the net earnings attributable to the number of shares in circulation so as to gauge the degree of profitability.
Earnings Date: The next earnings report is expected between January 27th 2025 and January 31st 2025.
Forward Dividend & Yield: RN 36.00 (0.52%) which affirms the capacity of the firm to pay dividends to its stockholders.
Release date: October 22nd, 2024
Bajaj Finance Limited builds upon the accomplishments attained during the first quarter relative to the performance statistics depicting significant improvement when compared to the results achieved in the previous year, as evidenced by continued victories across the board.
Bajaj continues to fortify itself in the competitive space of financial service provision with commendable metrics relative to the growing customer base and increasing assets under management.
1. Assets Under Management (AUM)
Total AUM: Grew to nearly 374077 crores INR during the quarter and there are increases to almost all segments concerning the total AUM.
Year-on-Year Growth: Demonstrated a yearly AUM growth of 29% which goes to speak of the company's resource uplift strategy as translating to operational success.
2. New Loans Booked
Increased by 14% to INR 9.7 million compared to the previous year, a sign of strong demand for Bajaj Finance’s financial products.
3. Customer Additions
Total Customers: In the second quarter alone the company registered 4 Million new clients to reach a total customer base of 92.1 Million which is substantial growth in the customer base of the firm.
4. Profitability Metrics
Profit Before Tax (PBT): Increased by 14% to INR 5,401 crores, demonstrating operational efficiency.
Profit After Tax (PAT): Rose by 13% to INR 4,014 crores, highlighting the company’s profitability in a competitive market.
5. Return on Equity (ROE)
It recorded a satisfactory figure of 19.1% indicating great respect of equity capital in generating profits.
6. Asset Quality
Net Non-performing assets: NPA recorded an incredible number of 46 basis points in India which was indeed commendable exhibiting a strong asset quality and risk management practices.
7. Net Interest Income (NII)
Increased loan bookings potential that was coupled with superior rate management strategies aggressively pushed up NII growth by 23% to a figure of INR 8828 crores.
8. Operating Expenses
Operating Expenses to Net Total Income: Improved to 33.2%. This reading was at 34% in the previous financial year. Positively, this means that some companies improved their operational efficiency.
9. Credit Cost
Loan Loss Provisions: Gross loan loss and provisions were recorded at INR 934 crores, with net loan losses at INR 910 crores, showcasing effective credit risk management.
10. Cost of Funds
Increased marginally. Recorded cost of funds at 7.97%. It quite closely suits the interest rates within the economy at the moment.
10. Deposits Growth
The number increased by 21% to stand at INR 66,131 crores. This depicts the country’s customer trust and confidence in Bajaj finance and its attractive offerings.
12. Liquidity Buffer
Liquidity Position: Stood at INR 2,200 crores and therefore made sure that business has a strong and sufficient liquidity cushion to support all operational needs and growth.
13 . mployee Headcount
Total employees within the company has been pegged at 59,400, with 4,007 employees added in Q2. This highlights the company’s commitment to human resource development.
Bajaj Finance Limited faces an eager market with ‘highest growth potential’ expected from the company as per the following key valuation measures as of October 28th, 2024.
Market Capitalization: Approx. INR 4.27 trillion
Trailing P/E Ratio: 27.81
Price/Sales (TTM): 11.19
Price/Book (MRQ): 4.92.
Enterprise Value/Revenue: 17.94.
These metrics highlight Bajaj Finance's favorable valuation relative to its earnings and growth prospects, underlining its position as a leading financial services provider in India.
Bajaj Finance Ltd demonstrates strong financial performance across various metrics, emphasizing its profitability and operational efficiency. Here are the key financial highlights:
Profit Margin: 44.92%
Return on Assets (TTM): 4.15%
Return on Equity (TTM): 20.69%
Revenue (TTM): INR 342.26 billion
Net Income Available to Common (TTM): INR 153.75 billion
Diluted EPS (TTM): 248.81
Total Cash (MRQ): INR 124.03 billion
Total Debt/Equity (MRQ): 290.32%
Overall, Bajaj Finance Ltd.'s financial highlights reflect a strong operational performance, efficient asset management, and a healthy profit margin, positioning the company favorably for continued growth in the competitive financial services landscape.
As of October 29th 2024, the financial performance of Bajaj Finance shows notable variations across different time frames when compared to the benchmark S&P BSE SENSEX.
Year-to-Date (YTD) Return: Bajaj Finance has recorded a negative YTD return of -3.68%, underperforming the S&P BSE SENSEX, which gained 11.25%. This indicates that while the broader market experienced growth, Bajaj Finance faced challenges in its performance year-to-date.
1-Year Return: Over the past year, Bajaj Finance posted a decline of -5.99%. In contrast, the S&P BSE SENSEX has seen a strong positive return of 26% during the same period, showcasing significant underperformance by Bajaj Finance compared to the benchmark index.
3-Year Return: Bajaj Finance also lagged behind in the 3-year window, showing a return of -4.95%, while the SENSEX delivered a strong return of 33.98%. This divergence indicates that Bajaj Finance has struggled to keep up with the overall market’s upward trajectory in recent years.
In summary, while Bajaj Finance has faced recent headwinds, resulting in underperformance in short- to medium-term returns relative to the SENSEX, its long-term performance remains strong. Investors may view this as a potential recovery opportunity, particularly if Bajaj Finance can regain its growth trajectory in alignment with the broader market.
Bajaj Finance Ltd has exhibited a strongly bullish trend, consistently respecting an ascending trendline on the weekly chart since April 2021. Following a recent rejection at this trendline, the next price targets are set at INR 7,806, followed by the all-time high of INR 8,192.
This uptrend highlights the potential for continued bullish momentum as the stock approaches these key resistance levels.
Bajaj Finance Ltd continues to showcase strong growth and resilience in the financial services sector, as evidenced by its impressive Q225 earnings report and strong market performance. With significant increases in assets under management, customer additions and profitability metrics, the company is well-positioned for future growth.
The favorable valuation measures and positive technical analysis underscore investor confidence in Bajaj Finance's potential. As it expands its product offerings and market presence, particularly in semi-urban and rural areas, the company is likely to maintain its upward trajectory. Overall, Bajaj Finance remains a key player in India's financial landscape and its future performance will be closely monitored by investors and analysts alike.