Bajaj Finserv stock climbs 1% despite 31% yoy decline in Q1 PAT to Rs833cr

The company’s total income falls marginally to Rs13,949cr in June 30, 2021, ended quarter.

Jul 22, 2021 09:07 IST India Infoline News Service

Bajaj Finserv
Bajaj Finserv Limited consolidated total income declined to Rs13,949cr in the June 30, 2021 ended quarter compared to Rs14,192cr on June 30, 2020, ended quarter. The company’s consolidated profit after tax (PAT) dropped 31.4% yoy to Rs833cr in Q1FY22 from Rs1,215cr in Q1FY21.

The company said, Bajaj Finance, consolidated profit after tax rose to Rs1,002cr in Q1FY22 against Rs962cr in the same quarter last year. Bajaj Allianz General Insurance Company (BAGIC), profit after tax was at Rs362cr vs Rs395cr in Q1FY21. Bajaj Allianz Life Insurance Company (BALIC), shareholders' profit after tax was at Rs84cr v/s Rs130cr in Q1FY21.

“After a brief recovery in Q4 of FY21, economic conditions worsened in Q1 FY22 as the second wave of COVID spread across the country accompanied by localised lockdowns in many states. Sales of consumer durables and motor vehicles were affected in many states and, consequently, risk levels remained elevated in the quarter."

"Under these challenging times, our businesses focussed on managing risk with a calibrated approach to growth. The life insurance business, in particular recorded strong growth in Q1FY22, well above the industry growth,” the company said in a filing on Wednesday.

“Under Ind AS, the insurance subsidiaries have chosen to hold a large part of the equity securities portfolio as Fair Value Through Profit and Loss Account. Unrealised Mark-to-market gain on investments (post tax) included in consolidated profit was Rs25cr for Q1FY22 v/s Rs330cr for Q1FY21. During Q1FY21, equity markets had recorded very strong growth after steep fall in Q4 of FY20."

Loan losses and provisions for BFL in Q1FY22 including expected credit loss was Rs1,750cr v/s Rs1,686cr in Q1FY21. BFL holds a management overlay and macro provision of Rs483cr as of June 30, 2021.

BAGIC results include pre-tax impact of COVI0-19 claims of Rs283cr in Q1FY22 v/s Rs14cr in Q1FY21 (post tax impact on BFS Q1FY22 profit Rs157cr).

BALIC results include pre-tax impact of COVID-19 claims of Rs288cr in Q1FY22 v/s Rs1cr in Q1FY21 and reversal of tax provision on the basis of favourable income tax orders for earlier years of Rs161cr in Q1FY22 (net post tax impact on BFS Q1FY22 profit Rs70cr.

Ata round 9.27 AM, Bajaj Finserv Limited was trading at Rs12740.40 per piece up Rs149.00 or 1.18% on the BSE. The stock hit a day's high of Rs12918.70 per piece early on Thursday.

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