Bajaj Finance (BAJFINANCE) Q4 14/15 earnings summary

Executive summary

• FY2015 total income rose 33% to ₹5,418 crore; receivables under financing grew 36% to ₹31,199 crore and AUM rose 35% to ₹32,410 crore.

• PBT increased 24% to ₹1,357 crore and PAT rose 25% to ₹898 crore, supported by volume growth, healthy net interest margins, operating efficiency and prudent risk management.

• Growth was strongest in Consumer and SME Lending; Commercial Lending contracted as infrastructure risk prompted selective lending and an exit from Construction Equipment finance.

Financial highlights

• Standalone total income was ₹5,418.23 crore vs ₹4,074.35 crore in FY2014; PBT was ₹1,356.94 crore vs ₹1,091.16 crore and PAT was ₹897.87 crore vs ₹719.01 crore.

• Net interest income increased 27% to ₹3,170 crore; interest and finance charges rose 43% to ₹2,248 crore.

• Loan losses and provisions increased 49% to ₹385 crore from ₹259 crore, reflecting portfolio growth and conservative provisioning.

• Basic EPS was ₹179.94 vs ₹144.79; diluted EPS was ₹177.70 vs ₹143.65.

• Proposed dividend was ₹18 per share, or 180% of face value, vs ₹16 per share in FY2014.

Outlook and guidance

• Management expected to maintain or exceed the existing growth trajectory, while emphasizing that additional capital would support growth and sound capital adequacy.

• Rural lending was identified as a growth opportunity, with plans to expand prudently; receivables rose from ₹50 crore to ₹333 crore in FY2015.

• Access to UIDAI’s e-KYC database was expected to improve customer experience and support growth in the coming year.