Bajaj Finserv Q3 PAT up 14.6% yoy at Rs1290cr on fair value gains

Bajaj Finserv reported 9.61% growth yoy in Dec-20 quarter consolidated revenues at Rs15,960.72cr. The company reported growth across its key verticals of insurance and fee-based business but its lending business saw yoy fall in revenues due to the lockdown.

For the Dec-20 quarter, the consolidated operating profits were up 5.79% at Rs2,779.16cr. This was largely on the back of fair value gains on investments during the quarter even as finance costs were down 10% yoy. However, the operating margin or OPM contracted marginally from 18.04% in the Dec-19 quarter to 17.41% in Dec-20 quarter.

Consolidated Profit after tax (PAT) for the Dec-20 quarter was up 14.6% at Rs1289.96cr on lower profits attributable to non-controlling interests during the quarter. PAT margins expanded in a small way from 7.73% in Dec-19 to 8.08% in Dec-20.

Financial highlights for Dec-20 compared yoy and sequentially

Bajaj Finserv
Rs in Crore Dec-20 Dec-19 YOY Sep-20 QOQ
Total Income (Rs cr) ₹ 15,960.72 ₹ 14,560.74 9.61% ₹ 15,051.59 6.04%
Operating Profit (Rs cr) ₹ 2,779.16 ₹ 2,627.16 5.79% ₹ 2,156.60 28.87%
PAT (Rs cr) ₹ 1,289.96 ₹ 1,125.64 14.60% ₹ 986.29 30.79%
Diluted EPS (Rs) ₹ 81.00 ₹ 70.70 ₹ 62.00
OPM 17.41% 18.04% 14.33%
Net Margins 8.08% 7.73% 6.55%

Key takeaways from the Dec-20 quarter results

  • Bajaj Finserv being the holding company for the financing, fee-based and the insurance business of Bajaj Group, we have considered the net profit after adjusting for non-controlling interest in group companies to give a better picture.

  • Net gain on fair value chances was up more than 150% at Rs2,060cr on its participating insurance policies due to the fair value gains on debt and to an extent in equities also. Most bonds gained on lower bond yields on a yoy basis.

  • Gross premiums for the Bajaj Allianz insurance business is almost equally divided between life insurance and general insurance. The insurance business was one of the few businesses to actually benefit from the pandemic.