The Strong Business Updates That Have Bajaj Finance Share Flying High

We take a look at the recently declared business updates of Bajaj Finance which has its stock reaching a record high in the market.

Trading at a 52-Week High
  • Bajaj Finance has been one of the major wealth creators in the stock market
  • The company recently provided an update on its Q1 performance
  • There has been strong growth in all the vital business indicators
  • Experts are optimistic about the company’s near-term future

Bajaj Finance is a major player in the Indian financial sector, with a market cap of Rs 4.75 trillion. Its share price is galloping towards the Rs 8,000 mark, having touched a 52-week high of Rs 7,918. Only three months ago, the stock was operating at around Rs 5,500.

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Strong Quarterly Expectation 

The company is expected to deliver a strong Q1 performance. Buoyed by this expectation, the Bajaj Finance share price has surged in the last few days. On Tuesday, 4 July 2023, the share rose by 8%. 

  • The company updated media that its loan book has seen an increase of 34% compared to the Q1 FY22 performance. The loan book is presently 9.94 million.

  • The deposit book also saw an increase of 46%. The size at the end of the first quarter is around Rs 49,900 crores.

  • This quarter has also seen the highest-ever increase in the assets under management (AUM), with a growth of 32%. The company’s present AUM is Rs 270,050 crores. The AUM mix is also reported to be stable. 

  • The consolidated net liquidity surplus of the company is Rs 12,700 crores.

  • Customer franchise is another performance indicator in this sector. Bajaj Finance’s customer franchise at the end of Q1 stood at 72.98 million, with the highest-ever quarterly increase in customer franchise of 3.8 million. Customer franchise at the end of the first quarter, FY22 was 60.3 million.

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Encouraging Signs

The strong financial update point towards a positive future for the company. The unprecedented AUM growth indicates that there have been strong disbursements across the Bajaj Finance product line. There is an improvement in the asset quality and an overall improvement in the operating conditions. It is believed that the company caters to a large section of mass-affluent borrowers whose creditworthiness is of little concern. Perhaps, with the exception of the auto finance category.

S&P Global Ratings has given thumbs up to the company’s stock performance in the coming days. It expects the company to maintain a healthy capital level in the next two years.

The stock has a target price of Rs 8,440, with a support price of Rs 7,580 and Rs 7,700. The immediate resistance price is set at Rs 7,985. Notably, Bajaj Finance is one of the main wealth creators in the Indian stock market. The share has seen a 168% growth in three years, and 5472% growth in 10 years. Even in this calendar year, the stock has risen by 20%.

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Final Words

Along with Bajaj Finance, Bajaj Finserv is also rallying with a 6% surge. As an investor, you must keep high-flying stocks like these on your radar.

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