Bajaj Finance has formed bottom multiple times near 1900–2000 levels in Oct 2018. Currently, it is trading at the same level. CMP 1979.
Stock Analysis on the basis of technical analysis
Technically stock is very bearish and every rise on the stock is getting sold. It is so bearish that even though the markets (Nifty) recovered from its 52 week low (7600) the stock is still trading at its 52 week low.
Technically above 3000 levels will be a good opportunity to add this stock.
Now, we will see some fundamental side of the stock.
Bajaj Finance is a bluechip stock and has created enormous wealth for its investors.
Even after falling 50%, it has given 15X returns to investors in the last 7 years.
Bajaj Finance Product Portfolio
On Oct 19, bajaj finance did a QIP of 8500Crores.
My point here is that, when the whole NBFCs were struggling to raise money, it did massive fundraising at 4000+ price.
Now, as per management, they have definitely pointed out that they have lost huge business due to the Covid19 pandemic.
Here is a snapshot of the company reports
Bajaj Finance was getting around 40+ PE multiples at 4500+ prices. The high PE multiples were due to high growth delivered by the company earlier years.
Currently, If we look at the Covid19 scenario, it is not slowing down and the economy is nearly at a halt due to this crisis. The market has already factored this information in the prices of Bajaj finance.
It is nearly impossible to predict a low or high of the stock and as an investor, you should not waste your time in doing so.
If you believe that the current situation of Covid19 will end soon and Bajaj Finance can easily come out they definitely this stock is a buy otherwise you should avoid it at any level.
Bajaj Finance has released its portfolio performance in quarterly results. Due to Moratorium, they have already started making provisions for the coming quarters.
Still, there is lot of uncertainty involved as per the business is concerned. And when uncertainty increases risks involved in business also increase.
