July 20, 2019

Bajaj Finance Ltd assigned an international rating of ‘BBB’

Bajaj Finance Ltd. (BFL), the most diversified non-bank in India, has been assigned a long-term issuer credit rating of ’BBB–‘ with a stable outlook and ‘A-3′ short-term issuer credit rating by S&P Global Ratings on Jan 31, 2019. The ‘BBB-‘ rating is equivalent to India’s sovereign rating assigned by S&P Global Ratings.

According to S&P Global Ratings, BFL’s comfortable capital levels and its strong market position drive the ratings on the company. BFL strong capital position is supported by high margins, low dividend pay-outs, and periodic capital infusions to support rapid growth. BFL has a strong market position in consumer durables and two- and three-wheeler financing. Tempering these strengths are its relatively high credit costs and reliance on wholesale borrowing.

S&P Global Ratings also says that “the stable outlook on BFL reflects our view that the company will maintain its superior financial performance despite some deterioration over the next 12-18 months. We also expect it to continue to gain market share without compromising its underwriting practices”.

Commenting on the report, Rajeev Jain, Managing Director, Bajaj Finance Ltd. said, “S&P Global ratings assigning its ‘BBB-‘ long-term issuer credit rating to Bajaj Finance Ltd. is indeed a very proud moment for us as a company. This will help us further diversify and strengthen our liability profile. We are committed to providing world-class financial solutions along with seamless experience to the consumers thereby creating all-around incremental value to all our stakeholders.”

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