EQUITIES

Bajaj Finance share price rallies 40% in one week; stock gains 6% in trade today

Bajaj Finance share price

Bajaj Finance share price surged over 6 per cent to hit day’s high of Rs 2,496.65 apiece on BSE taking the market capitalisation of the company to Rs 1,48,650.29 crore. In today’s upbeat trade on Dalal Street, Bajaj Finance was the top Sensex gainer and volume topper. The stock has skyrocketed 40 per cent in just a span of one week, as compared to an 8.2 per cent rise in S&P BSE Sensex. Bajaj Finance hit a 52-week low of Rs 1,783.10 apiece on BSE last week on Wednesday. However, even as Bajaj Finance rallied 40 per cent rally in one week, the stock price is still 97 per cent off from its 52-week high of Rs 4,923.20 touched in February this year on the back of coronavirus induced lockdown and other global factors. “Recording strong topline performance in the March quarter we believe that the heavy provisioning will give enough buffer in this challenging environment amidst COVID-19, eventually allowing the company to bounce back, we upgrade our rating to BUY,” Geojit Financial said in a research report.

At 11.35 AM, Bajaj Finance stock was trading 4.93 per cent higher at Rs 2,462.50 apiece on BSE in Wednesday’s strong trade. Bajaj Finance shares have fallen 69.48 per cent since the beginning of this year. Bajaj Finance reported a 19.38 per cent on-year decline in net profit at Rs 948.10 crore for the quarter ended March 31. The company had said that it has lost 10 productive days in the fourth quarter of the financial year 2020-21 due to the nationwide lockdown imposed to curb the fast-spreading coronavirus pandemic, which resulted in lower acquisition of nearly 1 million loan accounts and lower assets under management of around Rs 4,500 crore.

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The research and brokerage firm Geojit Financial has given a target price of Rs 2,570, an upside of nearly 10 per cent. “Given its strong liquidity position, healthy CRAR, strong geographical presence, growing AUM, positive outlook, and strong parentage, we upgrade to buy rating on the stock with a revised target price,” it said in a report. “The company has taken an accelerated charge of Rs 390 crore for two identified large accounts, an additional provision of Rs 129 crore on account of recalibration of its ECL model and a contingency provision of Rs 900 crore for Covid-19,” Bajaj Finance said in its press release.

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