SECTOR: Finance - NBFC
₹ 376126.8 Cr.
₹ 113089.94 Cr.
₹ 23549.72 Cr.
₹ 3955.51 Cr.
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Around 2% of India's total population invests in financial assets. The penetration of the mutual fund industry in India is close to 7% (Based on the number of PAN cardholders). This under penetration of the mutual fund industry offers a huge opportunity for the industry to grow.
Migration to financial savings, wider distribution and sustainable performance are expected to enable growth in the industry.
Also, increasing financial literacy among investors, digitization and the number of mediums available tend to attract more investors to invest in the financial markets.
To understand the functions of the Bajaj Finance better, you must go through the following points:
Key Financials –
Profitability: Profit margin (PAT margin) of the company shows how well a company controls its cost. It is one of the important indicators to show the financial health of the company. Net profit of the company is Rs 3955.51 Cr and the compounded growth of profit in the past 3 years is 16.7669418320029 %. The PAT margin of Bajaj Finance is 16.7964205094583 %.
EPS growth: Investors should ensure the EPS figure is growing faster than revenue numbers because it indicates company management is increasing the efficiency with which it runs the company. In Bajaj Finance , the EPS #if( -19.1853862151359 > 0) then "grew" else "declined";# by -19.1853862151359 % YOY.
Financial Ratios –
Return on Equity (ROE): The Company has a #if( 11.7661301993158 >= 20) then "healthy" elseif( 11.7661301993158 < 20 and 11.7661301993158 >=10) then "average" else "poor";# ROE track record. The ROE of Bajaj Finance is at 11.7661301993158 % for the latest year.
P/E Ratio: Relative valuation metrics like the P/E ratio can be used to see if the stock of Bajaj Finance is worth at the current levels at Rs $$PRICE_Y_1$$. The stock is trading at a current P/E ratio of 78.3105043665532 and the average historical P/E for the last 5 years was 45.2657650205213.
P/B ratio can be one of the best metrics to value such companies. Currently, Bajaj Finance is trading at a P/B of 10.3402 . The average historical P/B for the last 5 years was 7.00773505520105. This can be compared with the Market price per share in order to know if the stock is undervalued or overvalued.