 "Bajaj Finance")
Bajaj Finance’s (BFL’s) consolidated net profit rose by 30 per cent year-on-year (YoY) to Rs 3,158 crore in the fourth quarter of financial year 2022-23 (Q4FY23) on the back of a robust increase in net interest income (NII). It made a profit of Rs 2,420 crore in the year-ago period.
In FY23, the non-banking finance company’s net profit jumped 64 per cent YoY to Rs 11,508 crore from Rs 7,028 crore in FY22.
The company’s board recommended a dividend payout of Rs 30 per share (1,500 per cent) of face value (Rs 2 each) for FY23, subject to shareholders’ approval, according to an exchange filing. Shares of BFL closed 0.4 per cent lower at Rs 6,054 apiece on the BSE. Its capital adequacy stood at 24.97 per cent, with tier -1 of 23.20 per cent at the end of March.
Its NII, which is the difference between interest earned on loans and paid on deposits, increased 28 per cent YoY to Rs 7,771 crore for Q4 from Rs 6,061 crore a year ago. In Q4, cost of funds was 7.39 per cent, an increase of 25 basis points (bps) over Q3.
Given the strong asset liability management and diversified balance sheet profile, there was no impact of interest rate hikes on net interest margin in FY23. The company expects gradual moderation in margins (40-50 bps) in FY24 and is factoring in one more repo rate hike by the Reserve Bank of India, BFL officials said in an analysts call.
The Pune-based company said the number of new loans booked during Q4 grew 20 per cent to 7.56 million, as against 6.28 million a year ago. The assets under management (AUM) grew by 29 per cent YoY to Rs 2,47,379 crore. AUM growth in Q4 was the highest ever at Rs 16,537 crore. AUM composition remained steady and it does not expect much change in the product mix.
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The share of mortgage loans in AUM was 31 per cent, followed by urban business-to-consumer (B2C) loans of 20 per cent and SME lending at 14 per cent. Rural B2C had 8 per cent share.
The asset quality profile improved with gross non-performing assets (GNPAs) moderating to 0.94 per cent in March 2023 from 1.6 per cent a year ago and net NPAs to 0.34 per cent from 0.68 per cent in March 2022.
The loan losses and provisions for Q4 was Rs 859 crore as against Rs 702 crore a year ago. The company held a management and macro-economic overlay of Rs 960 crore as of March 31. It reported a healthy provision coverage ratio of 63.8 per cent, up from 58 per cent a year ago.
