One that leverages the strengths, the overall IT calibre of the group and people resources to sustain businesses and create aggregate business value that is greater than the sum of its parts. Bajaj Finserv represents an interactive space, where we leverage the knowledge, practices, processes and benefits of one company to expand the business of others in the group.

Has this value magnifying interdependence occurred across the board? Frankly, not fully yet. But it is happening, and occurring at an accelerated daily basis. When all the nuts and bolts are in place, you too will see Bajaj Finserv as I see it today. As an integrated yet diversified financial services entity with a pan-India presence that offers lifecycle financial solutions for its customers.

These are not ‘big words’. The financial life-cycle needs of all customers involve five phases:

1. Asset acquisition: We facilitate these through loans and credit cards.
2. Asset protection: This occurs through general insurance policies.
3. Family health and income protection: These are done using general, health and life insurance, guaranteed savings and digital access to the health ecosystem.
4. Investment and wealth management: These are carried out through unit-linked investment products, fixed deposits and shares.
5. Retirement: These are met by annuities.

I am glad to inform you that your Company has received the licence to operate the mutual fund business through Bajaj Finserv Asset Management Ltd., which is expected to launch its first suite of products in Q2 of FY2024. This will further the Company’s offerings to its customers for their investment and wealth management needs.

Over the last few years your Company has invested in two emerging, digital-first platforms that offer immense prospects while supporting the established businesses that the Company offers. These are

• Bajaj Finserv Direct (or Bajaj Markets), which operates a BFSI marketplace on an open architecture platform digitally offering loans, credit cards, investments and insurance. It is a platform where the customer has a choice of providers as well as products. Bajaj Markets has also started a technology services division called SKALEUP offering digital technology services in the BFSI space.
• Bajaj Finserv Health, which is a health-tech venture that connects providers of healthcare such as hospitals, doctors, labs, pharmacies and wellness providers with retail and corporate users of health care, through a seamless digital platform, offering comprehensive healthcare services.

I am personally excited at the prospects of these start-ups.

Taken together, then, Bajaj Finserv is the ‘umbrella’ that offers all of these, either through itself, or through its constituent parts.

This is how your Company’s Management and I see the raison d’etre of Bajaj Finserv. We are creating a financial ecosystem. I urge you see it this way.

Having said so, I must now report the financial results of your Company’s key subsidiaries. For brevity, I will focus on (i) Bajaj Finance Ltd. (BFL), (ii) Bajaj Housing Finance Ltd. (BHFL), (iii) Bajaj Allianz General Insurance Company Ltd. (BAGIC), (iv) Bajaj Allianz Life Insurance Company Ltd. (BALIC), and (v) the consolidated financials of your Company.

Bajaj Finance Ltd.

• Number of new loans booked: 29.6 million.
• Customer franchise: grew by 20% to 69.1 million.
• Number of customers on Bajaj Finserv App: 35.5 million.
• Assets under management (AUM): increased by 25% to ` 247,379 crore.
• Total income: up 31% to ` 41,406 crore.
• Net interest income (NII): rose by 32% to ` 28,846 crore.
• Pre-impairment operating profit: increased by 31% to ` 18,716 crore.
• Profit before tax (PBT): increased by 63% to ` 15,528 crore.
• Profit after tax (PAT): increased by 64% to ` 11,508 crore.
• Capital adequacy ratio as of 31 March 2023: 24.97%, which is well above the RBI norms. Tier I adequacy was 23.20%.

Bajaj Housing Finance Ltd. (BHFL)

• Total income: up 50% to ` 5,665 crore.
• Net interest income: up 52% to ` 2,454 crore.
• PBT: up 77% to ` 1,700 crore.
• PAT: up 77% to ` 1,258 crore.
• AUM: up 30% to ` 69,228 crore.

Bajaj Allianz General Insurance Company Ltd. (BAGIC)

• Gross written premium (GWP): ` 15,487 crore, a growth of 12%.
• Market share in the industry: 6.4%.
• Net earned premium: ` 8,019 crore.
• Combined ratio: 100.5%.
• PAT: ` 1,348 crore.
• New policies issued in FY2023: approximately 28 million.
• Claims reported: 4.38 million.

Bajaj Allianz Life Insurance Company Ltd. (BALIC)

• Gross written premium (GWP): grew by 21% ` 19,462 crore. BALIC registered its highest ever GWP during the year.
• Individual rated new business (IRNB) premium: grew by 41% to ` 5,214 crore.
• New business premium: grew by 18% to ` 10,738 crore.
• Renewal premium: grew by 25% to ` 8,724 crore.
• PAT: ` 390 crore.
• 13th month persistency: improved to 83.2%.
• Embedded value: stood at ` 18,584 crore.
• AUM: ` 90,584 crore.

Bajaj Finserv Ltd. (consolidated)

• Total income: grew by 20% to ` 82,072 crore.
• Profit before mark-to-market gains: grew by 48% to ` 6,745 crore.
• Profit after mark-to-market gains: grew by 41% to ` 6,417 crore.

You will agree with me that these are very creditable results.

Before closing let me share with you something that is very dear to my heart. It is an employability initiative, which aims to upskill first-generation graduates from small towns and villages to gain the right aptitude and attitude for building a career in the financial services industry. The programme started in 2015 and has thus far benefited more than 30,000 fresh graduates across the country.

Under the financial skilling initiative, your Company conducts a customised 100-hour Certificate Programme in Banking, Finance and Insurance (CPBFI) for final-year undergraduate students. CPBFI comprehensively covers key aspects of employability, such as attitudes, skills and knowledge. Unlike conventional skilling programmes, it prepares students for more than 10 roles in the financial services industry

I see this as the minimum that your Company can do to give some returns to society. We will continue with it, and take it further ahead in the years to come.

To get back to what I started: your Company is not an aggregator. It strives to be an entity where the whole is greater than the sum of its parts.

Thank you for your good wishes. These matter a great deal to all of us.

Yours sincerely,

Sanjiv Bajaj

Chairman & Managing Director Bajaj Finserv Ltd.