Parts of Bajaj Finance were exchanging at 6785.30, down 6.22 percent from the previous close on the BSE in exchange on April 27, 2022, despite the organization’s most elevated at any point established net profit of 2,420 crores, a 79.67 percent year-on-year increase for the last quarter. The stock is currently trading at $1,200 less than its 52-week high.
Bajaj Finance reported its highest ever unified profit after the expense of 7,028 crores in the fiscal year ended March 2022, a 59 percent increase. The net benefit in 2020-21 was 4,420 crore.
The net revenue income (NII) of the non-banking financing organization increased by 30% to 6,068 crores in the March quarter, up from 4,659 crores in the previous quarter. New credits booked increased by 15% to 6.28 million, compared to 5.47 million in the same period last year.
Resources under management (AUM) increased by 29 percent to 1,97,452 crore (including IPO supporting receivables of 5,365 crore) on March 31, 2022, up from 1,52,947 crore on March 31, 2021. In Q4FY22, the center AUM increased by Rs 10,837 crore.
Advance misfortunes and arrangements for the year totaled 4,803 crores, down from 5,969 crores the previous year.
As of March 31, 2022, the GNPA and NNPA were 1.60 percent and 0.68 percent, respectively, compared to 1.73 percent and 0.78 percent as of December 31, 2021.
The company also recorded a profit of $20 per share. The record date for the profit installment is July 1, 2022.
CLSA, a global examination business, issued a ‘SELL’ recommendation and a Target Price (TP) of 6000 per share in a report dated April 27, 2022, implying an 11 percent discount from the current market value.
It stated that Bajaj Finance missed the Q4 benefit after tax (PAT) target by 9% due to a 6% NII shortfall. CLSA also reduced PAT gauges by 8% and 9% for the current year and one year from now, respectively.
CLSA highlighted two critical patterns in business loaning (ex-IPO funding) that have increased from 7.6 percent to 11.2 percent in the previous two years, and this is a low-yielding advance book, and the typical ticket size of home credits and LAP has increased from 17 percent to 19 percent in the previous two years, and this is adding to contract development, it added.
CLSA stated that it has seen a growing gap between the valuations of top-tier banks and Bajaj Finance in terms of contracted development outperformance over the previous year (FY22 credit development distinction between enormous private banks and BAF was just 500bps versus 1,500bps pre-Covid). CLSA acknowledges that Bajaj Finance’s fintech initiatives are a hygiene aspect rather than a value generator.