Bajaj Finserv spurts on strong Q1 result; stock split, bonus

Bajaj Finserv surged 9.16% to Rs 14,522 after the company's consolidated net profit rose 57% to Rs 1,309 crore on a 14% rise in total income to Rs 15,888 crore in Q1 FY23 over Q1 FY22.

Profit before tax in Q1 FY23 stood at Rs 3,593.91 crore, up by 103.3% from Rs 1,767.10 crore in Q1 FY22.

Total expenses rose 0.91% to Rs 12,294.04 crore. Employee benefits expense rose 59.7% to Rs 1,977.18 crore in Q1 FY23 over Q1 FY22.

Meanwhile, the board of Bajaj Finserv has approved 5-for-1 stock split and 1:1 bonus issue of shares. The company will split each equity share of face value Rs 5 each into Rs 1 each. Later it will issue one fully paid bonus equity share of the face value of Rs 1 each against one equity share of the face value of Rs 1 each. This is subject to shareholders' approval.

Bajaj Finserv is the holding company for the various financial services businesses under the Bajaj group. It participates in the financing business through its 52.49% holding in Bajaj Finance and in the protection business through its 74% holding in two unlisted subsidiaries, Bajaj Allianz General Insurance Company and Bajaj Allianz Life Insurance Company.

Bajaj Finance recorded 159% jump in consolidated net profit to Rs 2,596 crore in Q1 FY23 over Q1 FY22, mainly on account of robust AUM growth, higher net interest income and better asset performance. Total income for Q1 FY23 increased by 38% to Rs 9,283 crore from Rs 6,743 crore posted in Q1 FY22.

Assets Under Management (AUM) as at 30 June 2022 were Rs 204,018 crore as against Rs 159,057 crore as at 30 June 2021, registering an increase of 28% YoY.

Bajaj Allianz General Insurance Company (BAGIC)'s gross written premium for Q1 FY23 rose 25% to Rs 3,119 crore as against Rs 2,494 crore posted in Q1 FY22. The company wrote government health insurance of Rs 108 crore in Q1 FY23. Net earned premium increased by 2% to Rs 1,852 crore in Q1 FY23 from Rs 1,815 crore reported in Q1 FY22.

The claim ratio increased to 77.9% in Q1 FY23 from 75.9% in Q1 FY22, largely on account of higher severity (impact of inflation) in motor and health segments. The combined ratio was 104.6% in Q1 FY23 as against 103.4% in Q1 FY22, mainly due to higher claims ratio.

Profit after tax for Q1 FY23 stood at Rs 411 crore, up by 14% from Rs 362 crore in Q1 FY22.

As on 30 June 2022, solvency ratio was 349%, which is well above the minimum regulatory requirement of 150%. Assets Under Management (AUM), represented by cash and investments as on 30 June 2022 stood at Rs 25,362 crore (up 8% YoY).

Bajaj Allianz Life Insurance Company (BALIC)'s new business premium for Q1 FY23 more than doubled to Rs 2,917 crore from Rs 1,296 crore in Q1 FY22. The renewal premium for Q1 FY23 was Rs 1,452 crore (up 19% YoY).

Gross written premium for Q1 FY23 increased by 74% to Rs 4,369 crore from Rs 2,516 crore in Q1 FY22.

Shareholders' profit after tax during Q1 FY23 stood at Rs 124 crore, an increase of 48% from Rs 84 crore in Q1 FY22.

The solvency ratio stood at a healthy 527% as on 30 June 2022 as against the minimum regulatory requirement of 150%. Assets Under Management (AUM}, represented by total investments increased by 8% to Rs 83,072 crore as on 30 June 2022 as against Rs 77,270 crore as on 30 June 2021.

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