Bajaj Finance share price tanks 7% as Street gives a thumbs down on poor business update
CLSA has recommended a Sell on this counter with a price target of Rs 6,000. CLSA in a note said that the loan growth slowed despite a festive season. It said that the growth dragged in the October-December quarter which is otherwise a strong period owing to festivities
Bajaj Finance share price: Bajaj Finance shares tanked over 7 per cent or Rs 480 on the NSE in the intraday trade and were trading at Rs 6,083.65 around 12:05 pm. The stock fell on adverse views taken on the stock by top brokerages.
Macqaurie remains bearish on its prospects maintaining an ‘Underperform’ rating. It puts the price target at Rs 5275 estimating a 20 per cent or Rs 1,300 downside in it.
CLSA has recommended a Sell on this counter with a price target of Rs 6,000. CLSA in a note said that the loan growth slowed despite a festive season. It said that the growth dragged in the October-December quarter which is otherwise a strong period owing to festivities.
The Q3 disbursal grew in single digit as against 27 per cent YoY growth in Asset Under Management (AUM). The Q3 AUM was 2 per cent lower than its estimates of 7.5 per cent quarter-on-quarter.
Bajaj Finance Share Technical View:
The stock has underperformed the broader market Nifty50 by over 18 per cent, giving returns of negative 16.8 per cent against 1.3 per cent given by the latter over a 1-year period. The stock has been trading with high volatility with a 1-year beta of 1.41 according to data sourced from Trendlyne. The stock is available at a price to book value of 8.41, which is high as per industry standards.
Analyst Nilesh Jain recommends a Sell on rise at levels between Rs 6,400 and 6,500. He advised against exits at current levels. He said that the stock has cracked after adverse views by brokerages including Macquarie.
Momentum indicators RSI and MFI are at 46.7 and 46.6 respectively which are in a mid range. A number below 20 indicates that the stock is trading in oversold territory while above 70 it is in the overbought zone. The stock is moving below all 8 SMAs (Simple Moving Averages) – 5, 10, 20, 30, 50, 100, 150 and 200-day moving averages.
Price Movement Chart
What Other Brokerages Recommend?
- Morgan Stanley maintains ‘Overweight’ with a price target of Rs 8,900.
- Jefferies maintains a ‘Hold’ with a price target of Rs 8,160.
Intraday Price Movement
The company posted AUM of Rs 2.31 lakh crore as on 31 December 2022 which is up 27 per cent from Rs 1.8 lakh crore. The deposit book grew 41 per cent YoY to Rs 43,000 crore from Rs 30,481cr. The net liquidity was at Rs 12,750 crore. The capital adequacy ratio (CRAR) is at 25.1 per cent.
The stock has already corrected 24 per cent from the 52-week highs of Rs 8,045.
(Disclaimer: The views/suggestions/advises expressed here in this article is solely by investment experts. Zee Business suggests its readers to consult with their investment advisers before making any financial decision.)
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