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Informist, Tuesday, Nov. 11, 2025

 

--Bajaj Finserv: Confident of managing lack of GST input credit in coming mos 

--CONTEXT: Comments from Bajaj Finserv mgmt in post earnings analyst call 

--Bajaj Finserv: Need 2 qtrs to see full impact of lack of GST input credit 

--Bajaj Finserv: Discussing sharing GST input credit burden with distributors 

--Bajaj Finserv: See more room for cost optimisation over next 18 months 

--Bajaj Finserv: Don't see listing of any subsidiaries in next 2-3 yrs 

 

MUMBAI – Bajaj Finserv will need two quarters to realise the full impact of the lack of goods and services tax input credit after the recent GST cut on its subsidiary Bajaj Life Insurance, the management of the holding company said in a post-earnings analyst call on Tuesday. The company had to take a one-time hit of INR 1.12 billion in the September quarter for the lack of input tax credit, the management said.

 

"During the current quarter, the company's profitability was impacted by changes in the GST regulations applicable to all the retail life insurance products, particularly due to the loss of input tax credit," the management said. "While the withdrawal of input tax credit may create short-term pressure, we are confident of managing this in the next couple of quarters. We also believe that the GST exemption on retail life and health insurance premium is a tailwind for the industry in the medium to long term as it makes insurance more affordable and accessible to all," it said. 

 

Bajaj Finserv is the non-operating holding company of Bajaj Finance Ltd., Bajaj Life Insurance Ltd., Bajaj General Insurance Ltd., and Bajaj Finserv Asset Management Ltd. Bajaj Finance, in turn, is the promoter of Bajaj Housing Finance Ltd. and Bajaj Financial Securities Ltd. Bajaj Life Insurance and Bajaj General Insurance were previously called Bajaj Allianz General Insurance Co. Ltd. and Bajaj Allianz Life Insurance Co. Ltd., respectively.

 

The company said it is also in discussion with distributors on how to share the burden of GST. "It's quite obvious that customers are seeing prices are down. So, we are now working with distribution, and not just us, but the sector together on how we can share this GST burden with our distributors, our vendors, and of course, how we can ourselves parry it down," the management said. 

 

Talking about the product mix of its insurance businesses, the management of the company said it was satisfied with the product mix and would continue to hold on to the current structure. However, with the product mix in place, the company will work on cost optimisation. "...cost optimisation, there is still room in that direction, and you will see that in the next 18 months, more and more of that happening. So yes, the direction is positive," it said. 

 

Bajaj Finserv doesn't plan to list any of its subsidiaries in the next two to three years, the management said. It would look at the possibility only after the stake purchase from Allianz SE is completed by the October next year, it said. "Our capital consumers are currently only our health business and our AMC (asset management company). Therefore, it is not significant capital that we need at the moment. So we are quite comfortable at this stage, we will see once Alianz transaction is over what to do with that," it said.

 

Bajaj Finserv reported a net profit of INR 22.44 billion for the September quarter, down nearly 20% sequentially. Shares of the company closed 6% lower at INR 1,989.40 on Tuesday. The company declared its Jul-Sept earnings during market hours.  End

 

Reported by Kabir Sharma and Priyasmita Dutta

Edited by Avishek Dutta

 

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