 "Bajaj Finance nears record high ahead of Q4 results; up 6% in two days")
Bajaj Finance shares rose 2 per cent at Rs 3,060, gaining 6 per cent in the past two trading days on the BSE in an otherwise weak market ahead of January-March quarter earnings (Q4FY19) today.
The stock was trading close to its record high level of Rs 3,162, which it achieved on on May 3, 2019, in intra-day trade. At 10:31 am, the S&P BSE Sensex was trading flat at 37,109, down nearly 1 per cent in the past two trading days.
Since January 28, post December quarter (Q3FY19) results, Bajaj Finance has outperformed the market by surging 25 per cent from the level of Rs 2,456. In comparison, the benchmark index was up 4 per cent during the same period.
According to rating agency CRISIL, Bajaj Finance's asset-liability profile is comfortable. As on March 21, 2019, till August 31, 2019, the company has debt repayments of Rs 12,540 crore of which commercial paper repayments are around Rs 7,695 crore. As March 21, 2019, it has cash and cash equivalents of Rs 3,525 crore and unutilized bank lines of Rs 4,202 crore.
Bajaj Finance's liquidity profile also benefits from the high proportion of shorter-tenor assets such as consumer durables; it has significant positive gaps in its ALM, indicating that business inflows support repayments, CRISIL said in a rating rational on April 5, 2019.
Analysts at Narnolia Financial Advisors expect Bajaj Finance’s profit after tax to grow at the rate of 55 per cent year-on-year. Rise in operational efficiency will result in decline of cost to income or C/I ratio going ahead.
“Net Income growth is expected to be 40 per cent in Q4FY19 driven by strong assets under management (AUM) growth. The strong growth AUM is expected to be driven by rural portfolio. Loan growth is expected to remain strong at 45 per cent in Q4FY19. Management has also guided to maintain liquidity cushion in the balance sheet which may slightly affect net interest margin (NIM) in Q4FY19,” the brokerage firm said in results preview.
“In line with seasonal trends, we expect loan growth to moderate to 7 per cent quarter on quarter (qoq) from 10 per cent qoq in Q3FY19. NIM will likely moderate to 11.1 per cent, down from 12 per cent in Q3FY19, due to lower share of the high-margin consumer business, in line with seasonal trends,” Kotak Securities said in earnings preview.
The stock was trading close to its record high level of Rs 3,162, which it achieved on on May 3, 2019, in intra-day trade. At 10:31 am, the S&P BSE Sensex was trading flat at 37,109, down nearly 1 per cent in the past two trading days.
Since January 28, post December quarter (Q3FY19) results, Bajaj Finance has outperformed the market by surging 25 per cent from the level of Rs 2,456. In comparison, the benchmark index was up 4 per cent during the same period.
According to rating agency CRISIL, Bajaj Finance's asset-liability profile is comfortable. As on March 21, 2019, till August 31, 2019, the company has debt repayments of Rs 12,540 crore of which commercial paper repayments are around Rs 7,695 crore. As March 21, 2019, it has cash and cash equivalents of Rs 3,525 crore and unutilized bank lines of Rs 4,202 crore.
Bajaj Finance's liquidity profile also benefits from the high proportion of shorter-tenor assets such as consumer durables; it has significant positive gaps in its ALM, indicating that business inflows support repayments, CRISIL said in a rating rational on April 5, 2019.
Analysts at Narnolia Financial Advisors expect Bajaj Finance’s profit after tax to grow at the rate of 55 per cent year-on-year. Rise in operational efficiency will result in decline of cost to income or C/I ratio going ahead.
“Net Income growth is expected to be 40 per cent in Q4FY19 driven by strong assets under management (AUM) growth. The strong growth AUM is expected to be driven by rural portfolio. Loan growth is expected to remain strong at 45 per cent in Q4FY19. Management has also guided to maintain liquidity cushion in the balance sheet which may slightly affect net interest margin (NIM) in Q4FY19,” the brokerage firm said in results preview.
“In line with seasonal trends, we expect loan growth to moderate to 7 per cent quarter on quarter (qoq) from 10 per cent qoq in Q3FY19. NIM will likely moderate to 11.1 per cent, down from 12 per cent in Q3FY19, due to lower share of the high-margin consumer business, in line with seasonal trends,” Kotak Securities said in earnings preview.
One subscription. Two world-class reads.
Already subscribed? Log in
Subscribe to read the full story →*Subscribe to Business Standard digital and get complimentary access to The New York Times
Smart Quarterly
₹900
3 Months
₹300/Month
SAVE 25%
Smart Essential
₹2,700
1 Year
₹225/Month
SAVE 46%
*Complimentary New York Times access for the 2nd year will be given after 12 months
Super Saver
₹3,900
2 Years
₹162/Month
Subscribe
Renews automatically, cancel anytime
Here’s what’s included in our digital subscription plans
Exclusive premium stories online
Over 30 premium stories daily, handpicked by our editors
Complimentary Access to The New York Times
News, Games, Cooking, Audio, Wirecutter & The Athletic
Business Standard Epaper
Digital replica of our daily newspaper — with options to read, save, and share
Curated Newsletters
Insights on markets, finance, politics, tech, and more delivered to your inbox
Market Analysis & Investment Insights
In-depth market analysis & insights with access to The Smart Investor
Archives
Repository of articles and publications dating back to 1997
Ad-free Reading
Uninterrupted reading experience with no advertisements
Seamless Access Across All Devices
Access Business Standard across devices — mobile, tablet, or PC, via web or app
SAVE 25%