Bajaj Finance's long range strategy lifts stock 5% higher

The consumer financier reported its highest-ever quarterly profit at Rs 2,973 crore in Q3FY23, up 40% YoY, aided by a healthy rise in NII and drop in provisions and contingencies

Bajaj Finance's long-range strategy (LRS) to funnel growth via various digital and offline products lifted the company's stock over 5 per cent in the intra-day trade on Monday. It, however, settled 4.67 per cent higher at Rs 6,025 per share as against the S&P BSE Sensex's 0.29-per cent gain.

"We raise our earnings estimate, but reduce valuation multiples, as competition intensity remains high especially in consumer finance and mortgage segments along with the company's plan to enter into risky microfinance business. However, re-rating can happen if the company executes a long range strategy framework and increases stickiness of new franchise customers,"