Morgan Stanley Highlights Key Focus for Bajaj Finance in Q2
After the Q2 update, brokerage firm Nomura stated that credit costs will be a crucial factor for Bajaj Finance in Q2.
Bajaj Finance's shares dropped more than 3 percent on October 4. This happened after they shared their Q2 business update. The update showed that their Assets Under Management (AUM) grew slower than in the past six quarters. At 09:32 AM, Bajaj Finance shares were priced at Rs 7,205.25 on the NSE. The non-bank finance company's AUM increased by 29 percent to Rs 3,73,900 crore for the July-September quarter. This is up from Rs 2,90,264 crore during the same period last year. Despite this growth, it marked the slowest AUM increase in six quarters. The customer base surged to 92.09 million as of the September quarter, compared to 76.6 million in the same period last year. New loans booked rose by 14 percent to nearly 1 crore, while the deposits increased by 21 percent to Rs 66,100 crore. Net liquidity surplus stood at Rs 20,100 crore for Q2. After the Q2 update, brokerage firm Nomura stated that credit costs will be a crucial factor for Bajaj Finance in Q2. They noted, "Any increase in FY25 credit cost guidance would be viewed negatively by the market." Nomura has a 'neutral' rating on Bajaj Finance with a price target of Rs 7,500. Morgan Stanley believes the main focus for Q2 will be on the management's confidence in improving asset quality from Q3. They also mentioned that comments about future credit costs will be important. Morgan Stanley has given Bajaj Finance an 'overweight' rating. They set a price target of Rs 9,000 for the stock. This suggests the stock could rise by 21 percent from its last closing price.
Bajaj Finance's shares dropped more than 3 percent on October 4.
This happened after they shared their Q2 business update. The update showed that their Assets Under Management (AUM) grew slower than in the past six quarters.
At 09:32 AM, Bajaj Finance shares were priced at Rs 7,205.25 on the NSE.
The non-bank finance company's AUM increased by 29 percent to Rs 3,73,900 crore for the July-September quarter.
This is up from Rs 2,90,264 crore during the same period last year. Despite this growth, it marked the slowest AUM increase in six quarters.
The customer base surged to 92.09 million as of the September quarter, compared to 76.6 million in the same period last year.
New loans booked rose by 14 percent to nearly 1 crore, while the deposits increased by 21 percent to Rs 66,100 crore. Net liquidity surplus stood at Rs 20,100 crore for Q2.
After the Q2 update, brokerage firm Nomura stated that credit costs will be a crucial factor for Bajaj Finance in Q2.
They noted, "Any increase in FY25 credit cost guidance would be viewed negatively by the market." Nomura has a 'neutral' rating on Bajaj Finance with a price target of Rs 7,500.
Morgan Stanley believes the main focus for Q2 will be on the management's confidence in improving asset quality from Q3.
They also mentioned that comments about future credit costs will be important. Morgan Stanley has given Bajaj Finance an 'overweight' rating.
They set a price target of Rs 9,000 for the stock. This suggests the stock could rise by 21 percent from its last closing price.
