Bajaj Finance Net Profit Declines 36% YoY; Asset Quality Improves

Bajaj Finance on Wednesday reported a 36% year on year (YoY) decline in net profit to Rs. 964.88 crore for the quarter ended September. In the same quarter last year, the company reported profit to the tune of Rs. 1506.29 crore.

Bajaj Finance Net Profit Declines 36% YoY; Asset Quality Improves

Net interest income of the consumer financing company increased 4 per cent YoY to Rs 4,165 crore. "During the quarter, as a measure of prudence, the company has reversed capitalised interest of Rs 142 crore. The total amount of interest income reversed in H1FY21 was Rs 361 crore," Bajaj Finance said in a release.

For the period under review, the company's net AUM or assets under management surged by a tad 1.15 percent to Rs.
1.37 lakh crore.

Asset quality at the NBFC also improved y-o-y with gross NPA at 1.03 percent in comparison to 1.61 percent last year in the same quarter. Net NPA also edged lower from 0.65 percent in September ended quarter of FY20 to 0.37 percent.

However losses due to loan and provisions for the review period inched higher to Rs. 17000 crore as against last year at Rs. 594 crore. "Consequent to the ongoing pandemic, the company has further increased its provisions on stage 1 and 2 assets by Rs 1,370 crore to Rs 5,099 crore as of September 30. The company has strong pre-provisioning profitability to manage loan losses arising out of Covid-19," Bajaj Finance said.

Shares of Bajaj Finance post the announcement of September ended result last traded lower by close to 1 percent at Rs. 3232.20 per share on the BSE.

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