Bajaj Finance scaling high

Bajaj Finance posted its highest ever quarterly net profit at Rs.1614 crore for Q3FY20 and the market yesterday celebrated that by hitting a new 52-week high at R.4444.40. And today, it opened at a new high at Rs.4464 and went on to Rs.4483.25; profit booking came in at this stage and the stock is now at Rs.4474.

The company posted a 33% (YoY) growth in consolidated profit before tax at Rs.2,170 crore. Adjusted for accelerated provisioning, profit before tax grew by 38%  to Rs.2,255 crore. Consolidated profit after tax for the quarter grew by 52% at Rs.1,614 crore.

Loan losses and provisions grew by 84% (YoY) in Q3 FY20 to Rs. 831 crores. During the quarter, the company has made an accelerated provision of Rs.85 crore in one of its loan against securities account. On the residual outstanding of this account, based on the progress in Q4, the company said that it will take a final call on provision. Adjusted for this, loan losses and provisions grew by 65% at Rs.746 crore.

Gross NPA & Net NPA stood at 1.61% and 0.70% as of 31 December 2019. Sequentially, GNPA is flat & NNPA has moved up by 5 bps.

From management assurance standpoint, the only portfolio that turned red in Q3 was the auto finance portfolio and the company said that it is taking corrective actions to improve portfolio metrics.

AUM grew by 35% YoY to Rs.1,45,092 crore as of 31 December 2019. New loans booked grew by 13% YoY to 7.67 MM.

Its annualized Return on Assets for the quarter was 4.78% and Return on Equity was 23.78%.