Below are Quote on Bajaj Finance Q1FY22 results by Mr. Jyoti Roy - DVP- Equity Strategist, Angel Broking Ltd   

Bajaj Finance reported a 12.3% YoY increase in Net interest income for Q1FY22 to Rs. 3,701 crore on the back of strong 15.2% YoY growth in advances. Operating expenses were up by 19.0% YoY while pre provisioning profits were down by 4.0% YoY to Rs. 3,116 crore. Provisioning for the quarter was up by 3.8% YoY and 42.3% QoQ to Rs. 1,750 crore. Consolidated PAT for the quarter was up by 4.2% YoY to Rs. 1,002 crore though it was down by 26.0% QoQ due to higher credit costs. As expected due to the Covid-19 pandemic there was a deterioration in asset quality during the quarter with GNPA and NNPA deteriorating to 2.96% and 1.46% from 1.79% and 0.75% in Q4FY21. Overall the company has managed the impact of the second Covid wave very well which was reflected in sequential AUM growth of 4.0% QoQ. Moreover the management has said that they are committed to bring down its GNPA to 1.7-1.8% & NNPA to 0.7-0.8% by Q4FY22 in absence of third Covid wave and expects credit cost of Rs. 4200-4300 crore for FY22. At current levels the stock is trading at 6.9xFY23 Abj. BVPS which is in line with historical averages. Post the Q1FY22 numbers we maintain our positive view on Bajaj Finance as we believe that the worst of the Covid related impact is now behind for the company.

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