Bajaj Finance has enough headroom to withstand moderate downside risks: S&P

BFL's credit costs will stay elevated at about 5 per cent in fiscal 2021 and improve to 2.5-2.7 per cent of total loans in fiscal 2022

Rating agency Standard and Poor’s (S&P) on Friday said that Bajaj Finance Ltd has sufficient financial headroom to withstand moderate downside risks arising from tough operating conditions over the next 12 months.
 

The ratings on BFL reflect the company's comfortable capital levels, strong market position in consumer durables and two- and three-wheeler financing, and adequate liquidity. Its tier capital ratio stood at 24.7 per cent as of December 31, 2020.
 

“Our ratings factor in a potential weakening in asset quality and elevated credit costs, providing a cushion to downside risks,” S&P said in a statement.
 

BFL's performance in the Q3FY21