Conservatism on progressive loan stays, says Prabhudas Lilladher
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Prabhudas Lilladher Report
The business update of Bajaj Finance Ltd. for the third quarter of fiscal 21 indicates a strong increase in customer base, but continued cautiousness with regard to additional loans.
5% growth in assets under management in Q2-Q3 of FY21, slowing the trend of additional QoQ loans in Q3 of FY21 and channel checks suggesting reduction in loan value with rigorous checks of Know your customer indicate the firm’s priority for credit quality over aggressive portfolio expansion.
While channel checks suggest improving consumer finance, the company’s knowledge about controlling delinquency until clarity emerges on the credit bureau remains credible.
In this context and a strong price dynamic, we believe that Bajaj Finance is entering a price zone perfectly.
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