Money & Banking

Bajaj Finance Q2 profit falls 36% to ₹877 crore

Our Bureau Mumbai | Updated on October 21, 2020 Published on October 21, 2020

The number of new loans booked during Q2FY21 were 44 per cent lower at 36.10 lakh

Decline in profit due to jump in loan-loss provisions during the quarter

Bajaj Finance Ltd (BFL) reported a 36 per cent decline in standalone net profit at ₹877 crore in the second quarter ended September 30, 2020 against ₹1,377 crore in the year ago quarter.

The decline in net profit is mainly on account of a 181 per cent jump in loan-loss provisions to ₹1,635 crore in Q2FY21 against ₹581 crore in Q2FY20.

Consequent to the ongoing pandemic, the company further increased its provisions on stage 1 and 2 assets by ₹1,306 crore to ₹4,879 crore as of September-end 2020 as against ₹3,573 crore as of June-end 2020.

During the reporting quarter, deferred tax credit of ₹263 crore cushioned the bottomline. In the year ago period, the company saw a deferred tax charge of ₹196 crore.

The number of new loans booked during Q2FY21 were 44 per cent lower at 36.10 lakh (64.50 lakh in Q2FY20). Assets under management declined about 6 per cent to ₹1,04,986 crore as at September-end 2020 against ₹1,10,946 crore as at September-end 2019.

Net interest income increased 5 per cent to ₹3,922 crore (₹3,746 crore).

Consolidated results

BFL's consolidated net profit, including the numbers of wholly-owned subsidiaries — Bajaj Housing Finance Ltd and Bajaj Financial Securities Ltd, was also down 36 per cent to ₹965 crore (₹1,506 crore).

The consolidated assets under management edged up 1 per cent to ₹1,37,090 crore as at September-end 2020 against ₹1,35,533 crore as at September-end 2019.

Also read: Bajaj Finserv applies for mutual fund licence

The company, in a statement, said liquidity surplus as of September-end 2020 stood at ₹22,414 crore (₹ 8,107 crore).

“The cost of liquidity surplus for Q1FY21 was approximately ₹220 crore as against ₹47 crore in Q2 FY20. The company’s liquidity position remains very strong,” BFL said.

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Published on October 21, 2020
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