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BFSI companies reported mixed performance


Bajaj Finance reported mixed performance in Q4FY25 with healthy balance sheet growth, though asset quality saw mild pressure. AUM rose 26% YoY to ₹4,16,661 crore, driven by ~1.07 crore new loans, a 36% YoY rise. The customer base increased by 47 lakh during the quarter, taking the total to 10.18 crore.
NII grew 22% YoY to ₹9,807 crore, despite 25 bps margin compression due to a 3 bps rise in cost of funds and a 22 bps impact from AUM mix change. Credit cost remained elevated at ₹2,329 crore, including ₹359 crore of additional ECL provisioning. As a result, PAT grew by 19% YoY to ₹4,546 crore.
GNPA and NNPA rose slightly to 0.96% and 0.44%, respectively. Credit cost appears to have peaked in Q4FY25. After three quarters of elevated provisions amid tightening of under-writing norms, management now expects credit costs to stabilize at ~1.85–1.95% in FY26E.
Continued robust AUM growth (24-25%), steady margins and operational efficiency (30-40 bps) is expected to keep RoA (calculated) at 4-4.2%. Long term business strategy remains unchanged with signs of stabilization in credit cost providing some conviction on incremental trends. Given growth at ~25% CAGR and RoA at 4% plus, we continue to remain positive on the stock.
Disclaimer – I ICICI Securities Ltd. ( I-Sec). Registered office of I-Sec is at ICICI Securities Ltd. - ICICI Venture House, Appasaheb Marathe Marg, Prabhadevi, Mumbai - 400 025, India, Tel No : 022 - 6807 7100. I-Sec is acting as a distributor to solicit bond related products. All disputes with respect to the distribution activity, would not have access to Exchange investor redressal forum or Arbitration mechanism. The contents herein above shall not be considered as an invitation or persuasion to trade or invest. I-Sec and affiliates accept no liabilities for any loss or damage of any kind arising out of any actions taken in reliance thereon. Investments in securities market are subject to market risks, read all the related documents carefully before investing. The contents herein mentioned are solely for informational and educational purpose.
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