NBFCs have started providing their business updates for the first quarter of FY 2023-24. The shares of this large-cap NBFC escalated 8% on Tuesday’s early trades to reach a fresh 52-week high of ₹ 7918.00 apiece. It surpassed its previous high of ₹ 7,777 touched on September 2022. At 11:40 AM, its shares were trading at ₹ 7,852.60 apiece.
Bajaj Finance’s new loans booked during the first quarter (April to June) of fiscal 2023-24 (Q1FY24) grew by 34 percent to 9.94 million as compared to 7.42 million in the corresponding quarter of the previous year (Q1FY23).
The company said that its assets under management (AUM) grew by 32 percent to approximately ₹ 2.7 trillion at the end of the quarter. It recorded its highest-ever quarterly increase in its AUM of approximately ₹ 22,700 crores in Q1FY24. Moreover, its AUM mix remained stable in Q1FY24.
The NBFC’s customer franchise stood at 72.98 million on June 30, up from 60.30 million as of June 30, 2022. Bajaj Finance recorded its highest-ever quarterly increase in its customer franchise of 3.84 million in the first quarter of FY24.
Its deposit book stood at ₹ 49,900 crores as of June 30, 2023, as compared to ₹ 34,102 crores as of 30 June 2022, indicating a YoY growth of 46%.
Brokerage firm Motilal Oswal in a note said that the company’s AUM growth was ahead of expectations and this suggests that the disbursements were strong across most of its product segments.
Brokerage firm CLSA upgraded the stock to ‘outperform’ from ‘buy’, with a price target of ₹ 9,000 from ₹ 6,600 earlier. This translates to an upside of 15% as compared to its current share price of ₹ 7,852.60.
It said that the company reported very strong quarterly numbers in the latest quarter. Moreover, the new customer acquisition remained healthy and volume growth disbursements remained strong at 34% year-on-year.
Bajaj Finance is a deposit-taking NBFC registered with the RBI and is classified as an NBFC investment and Credit Company (NBCC-ICC). The company has a diversified lending portfolio across retail, SMEs and commercial customers.
Bajaj Finserv is the parent company of Bajaj Finance and it holds a 52.49% stake in it. Shares of Bajaj Finserv soared 6% post the development.
With a market capitalization of ₹ 4,43 581 crores, Bajaj Finance is a large-cap company. It has a good return on equity of 23.46% and a dividend yield of 0.41%. Its shares were trading
at a price-to-earnings ratio (P/E) of 38.68 which is significantly higher than the industry P/E of 20.53, indicating that the stock might be undervalued as compared to its peers.
Written by Simran Bafna
