Synopsis
Shares of Bajaj Finance dropped by 2.6%. Despite this, new loans grew by 14% in Q2FY25. Assets under management rose by 29% to Rs 3.73 lakh crore. Global brokerages Morgan Stanley and Jefferies remain optimistic, with target prices of Rs 9,000 and Rs 8,410 respectively. Net profit grew by 14% in the first quarter. ETMarkets.com Shares of Bajaj Finance fell by 2.6% to a day’s low of Rs 7,240 on the BSE, even as new loans booked during the quarter grew 14% to 9.69 million in Q2FY25, compared to 8.53 million in Q2FY24.
Furthermore, assets under management (AUM) increased by 29% to Rs 3.73 lakh crore, up from Rs 2.9 lakh crore at the end of the September 2023 quarter. The AUM in Q2FY25 rose by approximately Rs 19,700 crore.
Net liquidity surplus for the September quarter stood at Rs 20,100 crore.
Meanwhile, deposits book was at Rs 66,100 crore as of September 2024, compared with Rs 54,821 crore as of September 2023, showing a growth of 21%.
Post the Q2 update, global brokerage firm Morgan Stanley has maintained its Overweight rating on Bajaj Finance with a target price of Rs 9,000.
Morgan Stanley stated that the AUM growth for Bajaj Finance was recorded at 5.6% QoQ, which was above estimates. The H1 customer acquisition is annualizing at 1.7 crore, significantly above the guidance of 1.3-1.4 crore for FY25.
The global brokerage expects Q2 PAT to be weak, weighed down by higher credit costs and low NIM. However, valuations still seem
attractive and FY26 PAT is expected to grow at 25%+.
Another global brokerage Jefferies gave a buy rating and a target price of Rs 8,410 on the stock.
Jefferies states that the Q2 update shows an expected moderation in AUM growth to 29% YoY vs. 31% for 1Q. The customer base grew by 20% YoY and new loan bookings fell 12% QoQ as credit filters were tightened. The global brokerage cautions to watch for trends in credit costs
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