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Analysed SWOT Analysis of Bajaj Finserv

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Bajaj Finserv is one of the fastest-growing NBFC in India which provides the fastest financial services in the country. It had many ups and downs over the years. But still, it has stayed firm in the market.

Thus this makes us think of its positive points and its negative points.

In this blog, we will look into the SWOT analysis of Bajaj Finserv and see what were its strengths, weaknesses, opportunities, and threats.

Before we start with Bajaj Fiserv’s SWOT analysis let us first start by knowing more about Bajaj Finserv.

 

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About Bajaj Finserv

brand logo of Bajaj Finserv- SWOT Analysis of Bajaj Finserv| IIDE

Bajaj Finance Ltd (BFL), an auxiliary of Bajaj Finserv Ltd, is a supplier of non-banking monetary administrations with store tolerating exercises. Its arrangement of contributions includes advances, speculations, protection, and cards. Loaning arrangements incorporate credits for individual use, home, gold, advance against offers, property, and fixed stores; rent lease limiting; advance for experts; and vehicle advances. Speculation administrations incorporate common assets and fixed stores. The protection portfolio comprises inclusion forever, wellbeing, and non-life. The organization additionally offers credit and EMI cards, and e-wallets. It takes into account individual and business customers through an organization of branch workplaces, online gateways, and venture counsels across India. Bajaj Finserv Limited is based in Pune, India.

Now that you have known about the company,

 

SWOT analysis of Bajaj Finserv

 SWOT Analysis of Bajaj Finserv| IIDE

SWOT analysis is the process of studying the business environment and knowing its strengths, weaknesses, opportunities, and threats and then improving its strengths, work on its opportunities, and being ready to face its weaknesses and threat

Let us first talk about the strengths of Bajaj Finserv in its SWOT analysis.

 

1. Strength

  • Bajaj Finserv has consistently given high returns over its stocks for the past 5 years.
  • It is one of the fastest-growing rural arms among others.
  • Bajaj Finserve has a wide range of financial services provided by them.

Quick services

  • Getting quick results are liked by everyone and this is one of the unique strengths of Bajaj Finserve which provides the customers with on-the-spot financing offers in three minutes which has now reduced to 3 seconds.

 Large, all around expanded NBFC 

  • It has arisen as one of the biggest retail resource financing NBFCs in India and proceeds with its two-dimensional technique of building scale and boosting benefit. Sections like home loans, independent venture advances, and business loaning are centered around building scale, while shopper tough advances, individual advances, and 2-and 3-wheeler financing are centered around expanding benefit.
  • As of March 31, 2020, resources under administration (AUM) developed 18% (year-on-year) to Rs 116102 crores on an independent premise. 
  • While the gathering has been announcing solid development in the AUM in recent years, developing at a CAGR of 27%, By the by, over the medium term, the gathering is required to keep on outperforming the business. 

Strong capitalisation 

  • Having a growing capital structure is one of the base motives of a business. 
  • Bajaj Finserv’s capitalization is powerful, with a sizable independent net worth of Rs 31813 crore and satisfactory Tier-I capital proportion and capital ampleness proportion (CAR) of 21.3% and 25.01%, individually, as of March 31, 2020.
  • Bajaj Finserv has shown the capacity to raise capital at ordinary stretches to monitor the equipping measurements. In the course of the last five fiscals, the gathering has raised Rs 14908 crores of value which has fundamentally expanded the net worth of the organization with the new capital raise being of around Rs 8500 crores in November 2019. Each time the outfitting measurements have crawled nearer to 7x, capital raising plans have been started and closed. 

Healthy profit 

  • Even after the covid-19 phase, Bajaj Finserv has managed to keep a high return as to the past year.
  • Income is upheld by an enormous extent of high return organizations and cutthroat getting costs. Return on oversaw resources (annualized) stayed sound at 3.8% in monetary 2020 against 3.9% in financial 2019.

Now let us look at the weaknesses of Bajaj Finserv in its SWOT analysis.

2. Weakness

Limited presence

Bajaj Finserv still has a limited presence in the market as compared to its competitors like LIC, HDFC, etc. It will have to work more on its brand awareness among people.

Inefficient financial planning in covid phase

  • The capital use was inefficient to generate profits. 
  • The revenue of the company is declining every year for the past two quarters.
  •  Mutual funds had decreased the holdings of Bajaj Finserv in the last quarter. MFs diminished their shareholding last quarter, Decline in Net Profit with falling Profit Margin (QoQ), Companies with High Debt Low Piotroski Score, Companies with powerless financials.

Now if we talk about Opportunities for Bajaj Finserv then these are the below-mentioned points we get.

 

3. Opportunities

Worldwide

Bajaj Finserve is mainly focused on the Indian market it needs to increase its reach outside India as well making it gaining more customers.

Competitor analysis

competitors of Bajaj Finserv-SWOT Analysis of Bajaj Finserv | IIDE

Bajaj Finserv can use the information related to its competitors to know the market capitalization which can be useful for market study.

Covid-19 phase

Due to the covid phase, the NBFC’s had faced a tough time so it can strategize for the future for it can give different offers to people.

After this phase is over there will be a different market that can use this opportunity and be the first one to grab most of the market.

Research and development

They can invest more in research and development in more advanced methods which can interest the people and eventually get more demand.

Finally, now let us see the Treats for Bajaj Finserv in its SWOT analysis.

 

4. Threats

After covid-19

Since covid has struck everything is now online and sooner or later it’s going to be normal everywhere. So, there are few people who will be opting for online services, Bajaj Finserv will have less demand from its online services.

Government/RBI norms

The government can impose rules for financial businesses relating to online services for the safety of the people investing in them. Or the RBI can bring new norms for banking facilities which can reduce the efficiency and speed of the loans given.

Competitors of Bajaj Finserv/Finance

It faces a lot of competition from other companies such as Mahindra Finance, Muthoot Finance, IDFC FIRST Bank, Shriram City, HDFC, Deal4loans, BankBazaar, EFSL, Reserve Bank of India, Reliance Capital.

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Conclusion

On the overall study of the SWOT analysis of Bajaj Finserve, we can say that the company has immense potential to grow in the market. 

As to its strengths, it has the most appealing feature in the market which is quick services. Customers get their financial services within 3 seconds and they have been able to maintain a healthy profit in the last year.

As to its weaknesses during the covid phase it faced inefficient financial planning which they will have to give more attention to this year and work more on reaching more new customers.

And about its opportunities, if they expand their business outside India and provide quick services as provided in India then it can be a game-changer for it in the market and be ready for the phase after covid is over.

Some of its treats are that after the covid phase is over people will go more offline and it will have less demand on its online services. Another threat is that the government and RBI can impose new norms.

Isn’t it interesting to know the SWOT analysis and grow your business? Learn how to grow your business using digital marketing, check out our website for more information.

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Lead Trainer & Head of Learning & Development at IIDE

Leads the Learning & Development segment at IIDE. He is a Content Marketing Expert and has trained 6000+ students and working professionals on various topics of Digital Marketing. He has been a guest speaker at prominent colleges in India including IIMs......[Read full bio]

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