Bajaj Finance share price jumped about 1.9% to Rs 6,170 today after reporting a strong 4QFY23 financial results. The company’s board has recommended a dividend of Rs 30 per share for the fiscal ending March 2023. Bajaj Finance reported a consolidated net profit of Rs 3,158 crore for the quarter ended March, 30% higher compared to Rs 2,419 crore in the corresponding quarter of the previous year. The net interest income (NII) for the reporting period surged 28% to Rs 7,771 crore from Rs 6,061 crore in the year-ago period.
“Bajaj Finance reported numbers which were in line with our expectations across all parameters. The impact of increasing CoF will now be visible on margins and the management also expects a 40-50bps margin compression in FY24. However, lower opex and benign credit costs will partially offset the pressure on NIMs,” said Dnyanada Vaidya, Research Analyst at Axis Securities.
Kotak Institutional Equities: “The current robust demand environment should sustain high growth for Bajaj Finance and other lenders in FY2024E. However, the lagged effect of rate hikes will likely temper margins, which may be partially offset by managing other matrices. The overall business outlook remains strong although rich valuations cap any upside; REDUCE stays with an FV of Rs 6,500 (up from Rs6,150).”
Motilal Oswal: “Bajaj Finance should be able to offset the NIM compression in FY24 with lower operating cost ratios and credit costs. Our FY24/FY25 estimates have seen a minor increase to factor in the higher AUM growth guidance. We expect BAF to deliver a PAT CAGR of 24% over FY23-FY25 and an RoA/RoE of 4.6%/24% in FY25.”