New loans booked
9.94 million
+34% YoY
Highest ever quarterly loan bookings, approaching 10 million milestone.
BAJFINANCE
Financial Services
20 Jul 2023
Bajaj Finance Ltd — Q1 FY24
Bajaj Finance delivered an excellent Q1 FY24 with PAT of INR 3,437 crore (up 32% YoY) and AUM growth of 32% to INR 2.7 lakh crore, the highest ever quarterly addition of INR 22,718 crore.
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2-Minute Summary
✦ AI-Generated from Full Transcript
Bajaj Finance delivered an excellent Q1 FY24 with PAT of INR 3,437 crore (up 32% YoY) and AUM growth of 32% to INR 2.7 lakh crore, the highest ever quarterly addition of INR 22,718 crore. The company booked 9.94 million loans and added 3.84 million new customers, with customer franchise reaching 73 million. Asset quality remained pristine with GNPA at 87 bps and NNPA at 31 bps. Management raised long-term ROE guidance to 21-23% from 19-21%. Key driver was strong demand across segments, especially B2B and consumer durables. Guidance: AUM growth of 29-31% for FY24, credit cost of 155-165 bps, and NIM compression of 10-15 bps in Q2 and Q3. Risk: rising consumer leverage in the system, particularly in personal loans, which management is proactively monitoring and tightening filters on rural B2C.
बजाज फाइनेंस ने पहली तिमाही में शानदार प्रदर्शन किया। कंपनी का मुनाफा 3,437 करोड़ रुपये रहा, जो पिछले साल से 32% ज्यादा है। कुल कर्ज (AUM) 32% बढ़कर 2.7 लाख करोड़ रुपये हो गया - अब तक का सबसे बड़ा तिमाही इजाफा। कंपनी ने 99.4 लाख कर्ज दिए और 38.4 लाख नए ग्राहक जोड़े, कुल ग्राहक 7.3 करोड़ पहुंच गए। कर्ज वसूली मजबूत रही - बुरे कर्ज (GNPA) सिर्फ 0.87% और बहुत बुरे कर्ज (NNPA) 0.31% रहे। प्रबंधन ने लंबी अवधि के मुनाफे का अनुमान 19-21% से बढ़ाकर 21-23% कर दिया। मुख्य वजह: कारोबारी और उपभोक्ता सामान कर्ज की मजबूत मांग। अनुमान: सालाना कर्ज वृद्धि 29-31%, कर्ज खर्च 1.55-1.65%, और ब्याज मार्जिन में अगली दो तिमाहियों में 0.10-0.15% की कमी। जोखिम: लोगों पर बढ़ता कर्ज का बोझ, खासकर पर्सनल लोन में - कंपनी इसे सतर्कता से देख रही है और गांवों में छोटे कर्ज पर पाबंदी बढ़ा रही है।
Key Numbers
Customer franchise
73 million
+21% YoY
Total customer franchise grew, with cross-sell franchise at 44.3 million.
AUM per customer
INR 61,000
flat YoY
Average AUM per customer remained stable, indicating quality growth.
Attrition rate (annualized)
13.8%
-70 bps YoY
Employee attrition improved from 14.5% in Q1 FY23, reflecting better retention.
Management Guidance
AUM growth of 29-31% for FY24
Management raised full-year AUM growth guidance from 27-29% to 29-31%, driven by strong Q1 momentum.
Management guidance growthCredit cost guidance of 155-165 bps for FY24
Full-year credit cost expected to be range-bound between 155-165 bps, including 6-8 bps from model redevelopment.
Management guidance marginsNIM compression of 10-15 bps in Q2 and Q3
Net interest margin expected to compress by 10-15 bps each in Q2 and Q3 due to repricing of borrowings.
Management guidance marginsNew car financing to reach INR 200-250 crore per month by March 2024
New car financing business, launched in 80 cities, is expected to achieve monthly disbursements of INR 200-250 crore by exit of FY24.
Management guidance growthKey Risks
Rising consumer leverage in personal loans
Management flagged increasing leverage in the system, especially in personal loans, and is taking preemptive actions to tighten underwriting.
medium · management_commentaryRural B2C portfolio stress
Rural B2C portfolio flagged as yellow due to elevated risk; business has been cut by INR 200-250 crore per month.
medium · management_commentaryNIM compression from rising cost of funds
Cost of funds rose 82 bps over three quarters, with NIM compression expected to continue for two more quarters.
medium · management_commentaryPotential impact of economic slowdown on asset quality
Analyst raised concern about unsecured loan growth; management acknowledged but expressed confidence in underwriting.
low · analyst_questionNotable Quotes
We think a 21%-23% ROE, given 19, 20, 23, 24, and mind you, last year, we had no one-timers, either as income or as great cost and given the Q1. We are penciling in that the long-term guidance, we are upping from 19%, 21% to 21%, 23%.
The amount of personal loan growth is troubling us. In fact, one of the objectives of us penciling in rural B2C, because we're seeing growth even there in terms of level of leverage.
We have strengthened the provisioning coverage ratio across businesses. That is costing us about INR 50 odd crores in the quarter one.
Frequently Asked Questions
What was Bajaj Finance's revenue in Q1 FY24?
Bajaj Finance reported revenue of — in Q1 FY24, representing a — change compared to the same quarter last year.
What guidance did Bajaj Finance management give for FY25?
AUM growth of 29-31% for FY24: Management raised full-year AUM growth guidance from 27-29% to 29-31%, driven by strong Q1 momentum. Credit cost guidance of 155-165 bps for FY24: Full-year credit cost expected to be range-bound between 155-165 bps, including 6-8 bps from model redevelopment. NIM compression of 10-15 bps in Q2 and Q3: Net interest margin expected to compress by 10-15 bps each in Q2 and Q3 due to repricing of borrowings. New car financing to reach INR 200-250 crore per month by March 2024: New car financing business, launched in 80 cities, is expected to achieve monthly disbursements of INR 200-250 crore by exit of FY24.
What are the key risks for Bajaj Finance in FY25?
Key risks include Rising consumer leverage in personal loans — Management flagged increasing leverage in the system, especially in personal loans, and is taking preemptive actions to tighten underwriting.; Rural B2C portfolio stress — Rural B2C portfolio flagged as yellow due to elevated risk; business has been cut by INR 200-250 crore per month.; NIM compression from rising cost of funds — Cost of funds rose 82 bps over three quarters, with NIM compression expected to continue for two more quarters.; Potential impact of economic slowdown on asset quality — Analyst raised concern about unsecured loan growth; management acknowledged but expressed confidence in underwriting..
Did Bajaj Finance meet its previous quarter's guidance?
Scorecard data is being built as historical quarters are processed.
Where can I read the full Bajaj Finance Q1 FY24 concall transcript?
The full earnings conference call transcript or source release is available on the linked source material. This page provides an AI-generated summary with filing verification status shown on the financial stats.