Bajaj Finance second-biggest gainer on Nifty50, up 3% post strong biz update

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Shares of Bajaj Finance rose as much as three percent on Wednesday after the company posted a strong business update on Tuesday night.

Bajaj Finance’s deposit book stood at approximately Rs 30,000 crore as of December 31, 2021, as compared to Rs 23,777 crore as of December 31, 2020. Deposit book in Q3 FY22 grew by approximately Rs 1,250 crore.

The company has not witnessed any adverse impact on its NPA position due to the transition to the new method of NPA recognition, the non-bank lender added.

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The company’s customer franchise increased by 2.6 MM in Q3 FY22 as compared to 2.2 MM in Q3 FY21, while new loans booked during Q3 FY22 were 7.4 MM as compared to 6.0 MM in Q3 FY21.

Bajaj Finance’s assets under management stood at approximately Rs 181,300 crore as of December 31, 2021, as compared to Rs 143,550 crore as of December 31, 2020.

The non-bank lender’s liquidity position remains strong and it continues to remain well capitalised with the capital adequacy ratio of approximately 27.0 percent as of December 31, 2021.

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With stronger-than-expected loan growth in Q3 and likely strong asset quality, Morgan Stanley has maintained its ‘overweight’ rating on Bajaj Finance shares. The brokerage house pointed out that new customer acquisition was the highest ever in a quarter.

CLSA pointed out that Q3 was one of the strongest since COVID in terms of growth, and new customer acquisition inched higher sequentially due to festival season. However, CLSA has maintained its ‘sell’ rating on the stock with a target price of Rs 6,000.

Meanwhile, ICICI Direct Research said, “We believe a spur in loans, customer addition and no adverse impact of transition on asset quality will be beneficial for the company and reflect in Q3FY22 earnings as well”.

At 9:57 am, the stock was up 2.4 percent on BSE and was the second-biggest gainer on the Nifty50 index. The stock has been gaining for the last four days and has risen over 9 percent during the period.

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