Categories Earnings, Finance, Research Summary, Trending Stocks

The Story Behind Bajaj Finance Q2FY23 Results

“An excellent first half for the company across balance sheet growth, portfolio quality and profitability. Strong momentum across all lines of businesses with secular AUM growth in the first half. Confident of strong FY23.”

– Management, Bajaj Finance Ltd.

Bajaj Finance Ltd. reported its highest ever net profit for the June – September Quarter. The 88% YoY growth in the net profit comes on the back of increase in Assets Under Management and reduction in Loan Loss provision. 

Thus, indicating that the lender has experienced growth in new businesses as well as an improvement in asset quality.

Financial Results:

₹ in Cr.Q2FY23Q2FY22YoY%
Assets Under Management2,18,3661,66,93731%
Net Interest Income7,0015,33731%
Loan Loss Provision7341,300(44%)
Profit After Tax2,7811,48188%
Net NPA %0.44%1.10%(66 bps)

Forward Guidance:

As per the investor presentation, the long term guidance for the lender would suggest that the management is confident in the future of the business. The management anticipates that the company would not experience a slow down in regards to AUM & Profit growth while anticipating that the asset quality would be of high quality in future periods.

Long Term GuidanceRange
AUM Growth25% – 27%
Profit Growth23% – 24%
GNPA1.4% – 1.7%
NNPA0.4% – 0.7%
ROA4% – 4.5%
ROE19% – 21%

To further read into the company’s workings, check out this link.

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