Rising industry leverage in small-ticket loans
Management flagged that customers with multiple small-ticket loans (<₹50,000) show higher imprudence and default rates, prompting portfolio cuts of 8-14%.
BAJFINANCE / Q2-FY24 / risks
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Bajaj Finance · Material risks, their source context, and severity in the latest available quarter.
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Material risks this quarter
high
NIM compression from rising cost of funds
Cost of funds is expected to rise as low-cost borrowings mature and are replaced at higher rates, compressing NIM by 25-30 bps for the full year.
Regulatory scrutiny on unsecured lending growth
Analyst raised concern about RBI's focus on unsecured loan growth; management acknowledged moderation in value but noted count growth remains elevated.
Potential risk weight increase on unsecured loans
Analyst asked about impact of possible risk weight hikes; management said they have levers to manage profitability but did not quantify impact.