Bajaj Finance reported a 58 per cent jump in its net profit in the third quarter ended December 31, 2015, on the back of robust growth in net interest income.

The non-banking finance company, which, among others, is into consumer lending, small business lending, commercial lending and rural lending, logged a net profit of ₹408 crore in the reporting quarter, against ₹258 crore in the year-ago period.

Net interest income (the difference between interest earned and expended) rose 48 per cent to ₹1,320 crore (₹893 crore a year ago).

Year-on-year assets under management rose 41 per cent to ₹43,452 crore (₹30,822 crore as at December-end 2014) on the back of robust growth in loans to various segments.

Rajeev Jain, Managing Director, said: “Last quarter was one of the rare quarters where everything went right. It was a strong quarter in that sense.”

Gross and net non-performing assets (NPAs) as of December 31, 2015, were a shade lower at 1.29 per cent (1.50 per cent last year) and 0.26 per cent (0.49 per cent), respectively.

Loan-loss provisions increased 35 per cent to ₹146 crore (₹108 crore). Provision-coverage ratio rose to 80 per cent from 68 per cent in the year-ago quarter.

Jain said: “We will continue to grow our balance sheet by around 25 per cent on a sustainable basis over the medium term. We will end FY16 with a balance sheet size of ₹45,000-46,000 crore.”

MCLR-based lending With banks required to price rupee loans with reference to the marginal cost of funds-based lending rate (MCLR) with effect from April 1, Jain observed that Bajaj Finance too will switch to this methodology of lending.

“We are launching our MCLR as well. We are not required to do that but we are doing it as we think it is the right thing to do,” he said.

Shares of Bajaj Finance closed at ₹6,380.50 apiece, up 9.45 per cent over the previous close on the BSE.

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