RIYADH/DUBAI: Saudi Arabia, the world’s top oil exporter, will adjust its Vision 2030 plan to transform its economy as needed, scaling back some projects and accelerating others, its finance minister said on Sunday.
Speaking at the World Economic Forum’s special meeting on Global Collaboration, Growth and Energy for Development in Riyadh, Mohammed Al Jadaan said the kingdom’s focus is on ensuring the quality of future economic growth, and recognises that the challenges it faces require flexibility.
“There are challenges… we don’t have ego, we will change course, we will adjust, we will extend some of the projects, we will downscale some of the projects, we will accelerate some of the projects,” Jadaan said.
Saudi Arabia is accelerating efforts to diversify its economy away from oil under a plan known as Vision 2030. It aims to develop sectors such as tourism and industry, expand the private sector and create jobs.
Non-oil activities vastly outperformed oil sector expansion last year growing by 4.4%, while the overall economy shrank by 0.8 per cent on the back of cuts to oil production and lower prices.
Saudi Arabia is projected to grow 2.6 per cent this year, a downward revision from 4 per cent forecast in October, the IMF said in its latest regional outlook report on the back of continued output cuts.
In the medium term, non-oil growth is expected to come in over 5 per cent a year, Jadaan said in February, although the kingdom is likely to continue to rely on hydrocarbon revenue to drive investments into expanding non-oil activities.
On Sunday, Jadaan re-emphasised the role of an expanded private sector in delivering Vision 2030.
“Vision 2030 is about empowering the private sector. The government role is to be out of business – the government role is to make policies to enable the private sector but not to actually do the business.” The Arab World’s largest economy needs oil at $96.2 to balance its 2024 budget, the IMF forecast.

Bajaj Finance reported a decent double-digit rise in profit and interest income year-on-year. Jio Financial, on the other hand, reported a single-digit sequential rise in profit and interest income.

Jio Financial debuted on bourses in August last year, so its Q4 numbers were not comparable year-on-year.

Bajaj Finance reported its March quarter earnings on Thursday, April 25. Its share price plunged 7.73 per cent to ₹6,729.85 the following day.

Also Read: Why Bajaj Finance shares have tanked 8% despite double-digit YoY growth in PAT, NII in Q4?

Jio Financial reported its Q4 earnings on Friday, April 19. In the subsequent sessions on April 22 and 23, the stock rose 3.54 per cent and 1.27 per cent. However, it witnessed profit booking thereafter and closed in the red in the next three days. Still, for the week, Jio Financial share price climbed over 3 per cent.

Also Read: Jio Financial Services stock gains by over 73% in 6 months; what’s driving the rally?

Q4 result: Key numbers of Jio Financial and Bajaj Finance

Jio Financial Services reported a 6 per cent quarter-on-quarter (QoQ) jump in Q4 consolidated net profit to ₹310.6 crore. The revenue from operations increased 1 per cent QoQ to ₹418.1 crore from ₹413.6 crore in Q3FY24.

Its net interest income (NII) rose 4.5 per cent QoQ from ₹269 crore in Q3FY24 to ₹281 crore in Q4FY24.

Pre-provisioning operating profit for the quarter under review inched up to ₹317 crore against ₹315 crore QoQ.

Also Read: Jio Financial Services Q4 results: Net profit jumps 6% QoQ to ₹310.6 crore, net interest income at ₹280.7 crore

Bajaj Finance reported a 21 per cent year-on-year (YoY) rise in consolidated net profit to ₹3,825 crore in Q4FY24.

Its net interest income (NII) for Q4FY24 saw a 28 per cent YoY rise to ₹8,013 crore against ₹6,254 crore in Q4 of FY23.

However, the lender’s net interest margin (NIM) shrunk 21 basis points (bps) in Q4 over Q3.

Also Read: Bajaj Finance Q4 hit by rural loan losses, RBI restrictions

Which stock should you buy?

Jio Financial and Bajaj Finance have their own strengths and weaknesses. While Jio Financial has strong promoter backing, Bajaj Finance has an impressive performance history.

Jio Financial has aggressive growth plans. Recently, the company signed an agreement with BlackRock Inc and BlackRock Advisors Singapore Pte Ltd to form a 50/50 joint venture for setting up wealth management and broking businesses in India.

Experts find both stocks attractive for the long term and suggest one should pick between them according to their risk appetite.

Amit Goel, Co-Founder and Chief Global Strategist at Pace 360, prefers Jio Financial to Bajaj Finance, considering its strong growth potential.

“Choosing between Bajaj Finance and Jio Financial depends on an investor’s risk appetite and investment goal. Jio Financial, backed by Reliance Industries, is a rising star with ambitious plans to dominate the Indian financial landscape. Jio Financial presents a riskier yet potentially faster growth opportunity. We would recommend Jio Financial Services between these two,” said Goel.

Jignesh Shial, the director of research and the head of the BFSI sector at InCred Capital underscored that Jio Financial Services is at an initial stage, and it is early to predict about the stock.

“Jio Financial enjoys a strong brand name and promoter backing though there is intense competition in all segments,” Shial pointed out.

Bajaj Finance is Shial’s preferred pick given the resilient growth metrics, management track record of dealing with roadblocks and consistency in performance.

“We have an add rating on Bajaj Finance with a target price of ₹9,000 as we continue to bet on the NBFC’s aggressive customer acquisition and flawless diversity into new business,” said Shial.

Also Read: TCS vs HCL Tech vs Wipro vs Infosys: Which stock to buy after Q4 results 2024?

Some technical analysts point out that technical charts also favour Bajaj Finance at this juncture.

Riyank Arora, a technical analyst at Mehta Equities, pointed out that Jio Finance is trading in uncharted territory and near its all-time highs. A pullback towards the ₹300-310 zone should offer an excellent long-term buying opportunity for the stock.

However, the technical indicators and chart structure of Bajaj Finance show more stability, and any move towards the ₹6,000 to ₹6,200 zone should be an excellent long-term buy for the stock, Arora observed.

“At current levels, if we compare the technical chart structure of both stocks, then on any 8-10 per cent downside from the current levels, one can look to accumulate Bajaj Finance with a long-term vision for targets of ₹10,000 and above,” said Arora.

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Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions.

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Published: 28 Apr 2024, 10:00 AM IST

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