Bajaj Finance revealed its December quarter earning on January 20, 2021, following which the financial company share price added 3% in early trade.
The company saw a 29%year-on-year (YoY) drop in consolidated net profit at Rs 1,145.98 crore for the quarter ended 2020. In the year-ago period, they saw a profit of Rs1,614.11 crore.
Consolidated net interest income (NII) for the quarter was reported at Rs 4,296 crore, plunging 5.3% YoY, as opposed to Rs 4,535 crore in the year-ago quarter.
The drop is attributed to the high reversal of interest income at Rs 450 crore versus Rs 83 crore in Q3FY20 and higher cost of liquidity surplus at Rs 213 crore versus Rs 83 crore in Q3FY20.
In the September quarter, the company saw its consolidated net profit fall 36% to Rs 965 crore. Provisions peaked at Rs 1635 crore as on September 31, 2020.
Motilal Oswal told MoneyControl that Bajaj Finance resumed disbursements which reached 90% of YoY levels in December, 2020. Its initial asset performance of incremental disbursements was just a touch better than pre-COVID times. He predicted minimal disruption in major asset quality in the coming term.
Sharekhan also lended their opinion to MoneyControl, suggesting that Bajaj Finance will see normalisation of business and prominent growth. Their strong balance sheet stands proof that the company is structurally a 20% return on equity (ROE) business franchise. They will continue their buy rating on the stock with a revised price target of Rs 6,000.
According to ICICI Direct, Bajaj Finance has emerged a winner keeping their eye on robust growth. Premium multiples will return for the company, ICICI Direct told MoneyControl. They continue to recommend buying the stock.
At 11:20 am, Bajaj Finance was quoting at Rs 5,143.10, up Rs 161.15, or 3.23 percent on the BSE.
The share touched its 52-week high at Rs 5,372.50 and 52-week low Rs 1,783.00.