Bajaj Finance Shares Gain By Over 5% After Q1Fy23 Results Beat Estimates

Shares of Bajaj Finance in trade on July 28, 2022 gained by over 5% to day high price of Rs.6766. This is after the company reported better than expected results on the previous day.

"Bajaj Finance reported stellar NII growth of 48%YoY to Rs. 6635 crore that was higher than estimates. Overall AUM growth of 28% YoY and sequential sharp GNPA improvement add to earnings growth momentum with PAT growth of 159% YoY and 7% QoQ to Rs. 2596 crore. In line with guidance C/I ratio is inching up gradually to 35.9% from 34.6% QoQ. With the deep investments being
committed to Omnichannel, opex to NII to remain elevated at 35-36% for FY23. GNPA NNPA stood (at pre-covid levels) at 1.25%
and 0.51% as of Q1FY23 vs 1.60% and 0.68% as of Q4FY22. AUM growth also gained traction as Core AUM was up 31% YoY at ₹ 2,04,018 crore primarily driven by Consumer B2B and Rural consumer B2B. Customer franchise stood at 60.30 mn as of Q1FY23. BAF is comfortable to add 9-10mn new customers in FY23. Led by strong ALM, management expects the impact of recentinterest rate hikes on cost of funds will be gradual.

On the results, ICICI Direct is optistic on the stock and mentions "BAF is well on track to get transformed into an adaptable new age fin-tech. Improvement in asset quality with high profits enabling provisions & w/off under check are positive", adds the brokerage.

Last the scrip of Bajaj Finance at around 9:28 am traded higher by 5.45% at Rs. 6747.75 per share on the NSE.