Banking/Finance Industry

Bajaj Finance Ltd.

Bajaj Finance Ltd (Formerly Known as Bajaj Auto Finance Ltd) is one of the leading Non
Banking Financial Corporation in India. Headquartered in Pune the company's product
offering includes Consumer Durable Loans Lifestyle Finance Digital Product Finance
Personal Loans Loan against Property Small Business Loans Home loans Credit Cards
Two-wheeler and Three-wheeler Loans Construction Equipment Loans Loan against
Securities and Rural Finance which includes Gold Loans and Vehicle Refinancing
Loans along with Fixed Deposits and Advisory Services. The Reserve Bank of India
classified the company as an Asset Finance Company. Bajaj Auto Finance Ltd was
incorporated on March 25 1987 as a private limited company. On 20 October 1987 it
became a deemed public company u/s 43A (1) of the Companies Act 1956. On 24
September 1988 it was registered as a Public Limited Company. On 5 March 1998 Bajaj
Auto Finance registered with RBI as a Non-Bank Company. In 1994-95 Bajaj Auto
Finance came out an initial public offer and was listed on the BSE and NSE. Initially the
company as was promoted by erstwhile Bajaj Auto Ltd and Bajaj Auto Holdings Ltd.
Corporate Background
Originally incorporated as Bajaj Auto Finance Limited on March 25, 1987, the non-
bank singularly focused on providing two and three wheeler finance. After 11 years in
the auto finance market, Bajaj Auto Finance Ltd launched its initial public issue of equity
share and was listed on the BSE and NSE.
At the turn of the 20th century, the company ventured into the durables finance sector.
In the subsequent years, Bajaj Auto Finance diversified into business and property
loans as well
In the year 2006, the company’s assets under management hit the Rs.1, 000 crore mark
and is currently at Rs.52, 332 crore. 2010 saw the company’s registered name change
from Bajaj Auto Finance Limited to Bajaj Finance Limited.

Ownership
The parent company, Bajaj Finserv Limited, holds 57.28% of the total shares and has a
controlling stake in the subsidiary. Other major investors include Maharashtra Scooters
Limited, Government of Singapore, Small cap World Fund INC and AXIS Long Term
Equity Fund.

SWOT Analysis
Strengths
 Promoters increasing shareholding

 Bullish Engulfing Pattern (Bullish Reversal)

 Increasing Revenue every Quarter for the past 4 Quarters

 Company with Zero Promoter Pledge

Weaknesses
 Decline in Net Profit (QoQ)

 Decline in Quarterly Net Profit (YoY)

 Decline in Net Profit with falling Profit Margin (QoQ)

  Decline in Quarterly Net Profit with falling Profit Margin (YoY)

 Companies with High Debt

 Low Piotroski Score : Companies with weak financials

 Recent Results: Declining Operating Profit Margin and Net Profits (YoY)

Opportunities
 Brokers upgraded recommendation or target price in the past three months

 Positive breakout ( LTP > R1)

 RSI indicating price strength

 Insiders bought stocks

Threats
 Recent broker downgrades in reco or target price

 Increase in Provisions in Recent Results

 Competitors
Balance Sheet

Profit & Loss account

Cash Flows

Conclusion
From the above competitors table we can see that Bajaj Finance ltd. have been
compared with other major six companies in India. From the table is clear that in all the
areas like market capital, sales turnover, net profit and also total asset, Bajaj Finance
have a very high position with a remarkable difference in their respective values. While
we analyse the competition we can determine that the company possess a dominancy
over the market. It is very difficult for the competitors to come over the Bajaj Finance
position. Considering the fact that the company profit is from the market it is important
for Bajaj Finance to maintain this status with more marketing strategies.

I have understood how Bajaj Finance ltd. have come up in such a highly competitive
market like in India and also they were able to establish their name in international
market also. Form this report we can see that the company is not just focusing on one
industry whereas it have many subsidiaries and associates which helping them to be
stable when the economy is down.