Why Bajaj Finance shares fell by ₹500 in one day today
Bajaj Finance shares fell 8%, or nearly ₹550, in the quarter ended December 31. When Bajaj Finance shared its business update with the exchanges, its assets under management (AUM) grew by 27% year-on-year to approximately ₹230,850 crore as on December 31, 2022, from ₹181,250 crore as on December 31, 2021. AUM in Q3 FY23 grew by approximately ₹ 12,500 crore. It was up 6% on a sequential (quarter-over-quarter) basis.
New customer acquisitions were slower than expected, although they were at a record high of 3.1 million in the quarter, analysts said, indicating that new loans booked were a significant contribution from existing customers.
“The company continues to grow strongly through existing customers, but we believe this cannot continue in the long term and growth will moderate in the medium term.”
Motilal Oswal said Bajaj Finance’s AUM growth fell short of expectations, though the growth attributed to strong distribution across product segments.
Also, capital adequacy ratio or CRAR was flat QoQ at 25.1%, indicating weak growth and low utilization of capital, Motilal Oswal said.
According to the quarterly update, Bajaj Finance acquired 3.1 million new customers in Q3 and 2.6 million in 2QFY23) According to Motilal Oswal, the new customer acquisition run-rate in the December quarter was healthy.
On a note, Jefferies said Bajaj Finance’s quarterly update for 3QFY23 shows a somewhat moderated AUM growth to 6% QoQ from 31%/7% in 2Q to 27% YoY. Growth in new loan bookings was also less than 5% year-on-year; QoQ growth of 15% is due to favorable seasonality (festival-period), brokerage added.
On the 3Q results, Jefferies added, “We will watch whether short-term bond lending business or retail/SME loans are responsible for this. Until then, softer growth may weigh on the stock in the near term.”
The deposit book stood at ₹43,000 crore, up 41% YoY and 9% QoQ. “Strong deposit growth suggested BAF continues to prioritize deposit growth,” Motilal Oswal said.
Jefferies has a hold rating on the stock while Motilal Oswal buys. At 9:40 am, Bajaj Finance shares were down 5% at ₹6,269 a share. (with agency inputs)