Bajaj Finance Q1 profit jumps 43% to Rs 1,195 crore on loan growth, provisions spike

Bajaj Finance Q1 profit jumps 43% to Rs 1,195 crore on loan growth, provisions spike

Bajaj Finance on Thursday reported 43 per cent year-on-year rise in its consolidated net profit at Rs 1,195 crore for the quarter ended June 30, 2019, driven by rise in assets under management (AUM).

“The financial services company had posted consolidated net profit of Rs 836 crore in the same quarter last year,” Bajaj Finance said in a filing to the Bombay Stock Exchange.

Bajaj Finance’s net interest income (NII), or the core income earned by giving loans, jumped 43 per cent to Rs 3,695 crore in April-June quarter of FY20 as against Rs 2,579 crore in the same quarter last fiscal.

The total income increased by 47 per cent at Rs 5,808 crore against Rs 3,938 crore in the same period last year, the company said.

The NBFC major’s total operating expenses to net interest income declined to 34.98 per cent in Q1 FY20 against 37.02 per cent in Q1 FY19.

Assets under management (AUM) surged 41 per cent to Rs 1,28,898 crore against Rs 91,287 crore in the same quarter of the previous year, the company said, adding that new loans booked during June quarter rose by 29 per cent to 0.73 crore from 0.56 crore.

As of June 30, 2019, customer franchise increased by 31 per cent to 3.69 crore from 2.83 crore in the corresponding quarter last year.

However, loan losses and provisions (expected credit loss) during the quarter jumped 69 percent year-on-year and 35 per cent quarterly to Rs 551 crore.

Bajaj Finance’s asset quality was stable during June quarter, as gross non-performing assets (NPAs) ratio – bad loans as a percentage of gross advances – rose marginally to 1.60 per cent, versus 1.54 per cent in March quarter. Net NPA stood at 0.64 per cent during June quarter as compared to 0.63 per cent in the last quarter. Provision coverage ratio was 61 per cent as against 60 per cent in previous quarter, the company said.

Shares of Bajaj Finance were trading at Rs 3,070.15 apiece on the BSE, down 3.20 per cent, as compared to the previous close on the BSE.