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Bajaj Finance Falls After Second Quarter Profit Missed Street Expectations;  Should you buy, sell or hold stocks now?


Bajaj Finance shares suffered large losses on Wednesday, a day after the non-bank financial firm’s profit for July-September profit missed Street’s estimates.

Bajaj Finance share has traded 4.1% lower to Rs 7,528.1 on late morning BSE, after dropping to 4.7% earlier in the day.

After Tuesday’s market hours, the NBFC announced a 53.5% year-over-year increase in net income to Rs 1,481 crore for the quarter ended September 30. Its net interest income – the difference between interest earned and interest spent – increased by four percent. at Rs 5,335 crore.

Here’s what brokerages are saying about Bajaj Finance after its second quarter results:

The brokerage has an “overweight” call on Bajaj Finance with a raised price target of Rs 9,060. The company’s earnings momentum is expected to accelerate significantly, and the decibels around its new initiatives are expected to rise to the future, according to Morgan Stanley. Bajaj Finance’s valuation is not cheap, but stocks rarely pause in such an environment, he added.

Bajaj Finance’s second-quarter numbers were 15% lower than estimated due to higher-than-expected provisioning, the brokerage said. HDFC Securities downgraded its profit estimate for fiscal 22 by four percent and fiscal 23 Projected four percent higher to account for higher credit costs in the current year offset by higher growth in assets under management going forward. The brokerage said that Bajaj Finance’s current strong valuation underlies its “cut” stance.

HDFC Securities, however, raised its target price for Bajaj Finance shares to Rs 5,498 from Rs 5,393.

(Edited by : Sandeep Singh)

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