Bajaj Finance Q1 Review - Asset Quality, Growth Show Transitory Pain; High Return Ratios: Motilal Oswal
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Motilal Oswal Report
Bajaj Finance Ltd.’s Q1 FY22 profit after tax was up 4% YoY / down 26% QoQ to ~Rs 10 billion (27% miss).
While net interest income at Rs 37 billion (5% miss) was up 12% YoY, opex was largely in-line.
Provisions came in at Rs 17.5 billion versus our estimate of Rs 15 billion.
The company aggressively wrote off ~Rs 9.2 billion worth of loans and kept Covid-19 overlay provisions at Rs 4.8 billion, leading to high provisions.
The gross non performing loan ratio increased from 1.8% to 2.96% QoQ.
Bajaj Finance wrote off ~Rs 9.2 billion (60 basis point of assets under management).
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