Bajaj Finance on Tuesday reported a 53% year-on-year rise in consolidated net profit at Rs 1,481 crore for the quarter ended September 30. Assets Under Management (AUM) for the September quarter grew by 22% y-o-y to Rs 1,66,937 crore compared to Rs 1,37,090 crore as of September 30, 2020.

“Net Interest Income for Q2FY22 increased by 28% to Rs 5,335 crore as against Rs 4, 162 crore in Q2FY21. Interest income reversal for the quarter was Rs 322 crore as compared to Rs 216 crore in Q2 FY21,” the company said. “In absence of a third wave, the company expects quarterly interest reversals to normalise to Rs 180-200 crore by Q3FY22,” Rajeev Jain, managing director, Bajaj Finance, said.

“During the quarter, the company accelerated write-offs of Rs 355 crore of principal outstanding on account of Covid-19 related stress and advancement of write off policy,” the company said. To protect itself from a potential third wave, the company said it increased management overlay provision during the second quarter to Rs 832 crore as of 30 September, 2021 from Rs 483 crore as of 30 June, 2021 .

Loan losses and provisions for the quarter stood at Rs 1,300 crore, as against Rs 1,700 crore in the September quarter of FY21. Total provisions in the first half of FY22 stood at Rs 3,051 crore.

Gross non performing assets were at 2.45% and net NPAs were at 1.10% as on September 30, compared to 2.96% gross NPA and 1.46% net NPA in Q2FY20. Gross non performing assets as of September 30, 2021 declined to Rs 4,103 crore as against Rs 4,737 crore on 30 June, 2021, while net NPA fell to Rs 1,826 crore from Rs 2,307 crore in June 30, 2021.

Jain said in the absence of a third wave, the company expects the quarterly AUM growth rate for balance of the year to be strong. New loans booked during the September quarter were 6.33 million, as against 3.62 million in 2FY21. Customer franchise grew by 20% to 52.80 million as of September 30, 2021, as compared to 44.11 million in the corresponding period last year. Customer franchise increased by 2.35 million in the September quarter compared to 1.16 million in 2FY21.

During the quarter, the company expanded its presence in 216 new locations. Total geographic footprint stood at 3,329 locations and 1,19,900 distribution points. The company also increased its employee strength by 2,000 to support its growth.

The company is upgrading its consumer app. The current app as 12.9 million customers. This is part of the company’s omnichannel strategy to enable customers to move seamlessly from online to offline and vice versa without any friction, Jain said.