Bajaj Finance - Second Covid-19 Wave Impacts Volumes, Asset Quality: Nirmal Bang
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Nirmal Bang Report
Bajaj Finance Ltd.’s mid-quarter update (Q1 FY22) indicates assets under management growth impact of Rs 40-50 billion (2.6-3.3% of FY21 AUM) and credit cost impact of Rs 11-13 billion due to asset quality deterioration caused by the second Covid-19 wave.
Equated monthly installment bounce rates are up (at 1.08 times of Q4 FY21) and forward flows across overdue positions are higher as collections have been constrained due to the severity of lockdowns across the country.
Non performing assets are expected to be elevated in the near-term.
In our last update, we had cited prolonged lockdowns as a key risk to growth.
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