Stock Snapshot
Price Performance
Recommendation Rationale
Strong growth outlook supported by diversified lending and operational efficiency.
Basis of our Recommendation
Bajaj Finance is poised for strong growth, driven by a robust FY26 performance and an optimistic outlook for FY27, underpinned by significant AI deployment and geographic expansion. The company anticipates a 22-24% growth in AUM and a substantial increase in customer base, despite facing some margin pressures and operational challenges in MSME lending. Overall, the diversified lending strategy and operational efficiency position the company favorably for sustained profitability.
Why We Like This Stock
- Projected AUM growth of 22-24% and 15-17 million new customer additions in FY27
- Strong performance in diverse lending segments such as Gold Loans and MFI Lending
- Significant deployment of AI expected to enhance operational efficiency and customer experience
Things To Watch Out For
- Marginal moderation in Net Interest Margin (NIM) expected for FY27
- Ongoing cost pressures from New Labour Codes impacting profitability
Key Parameters
Financial Snapshot
| Actuals | Forecast | ||||
|---|---|---|---|---|---|
| FY24 | FY25 | FY26 | FY27 | FY28 | |
| Revenue (Cr.) | 36,088 | 44,717 | 53,316 | 64,474 | 78,294 |
| Profit Before Tax (Cr.) | 19,323 | 22,116 | 26,082 | 37,034 | 47,043 |
| PBT Margin | 53.5% | 49.5% | 48.9% | 57.4% | 60.1% |
| Net Profit (Cr.) | 14,361 | 16,440 | 19,137 | 26,768 | 34,003 |
| EPS | 23.1 | 26.2 | 30.3 | 43.1 | 54.7 |
Company Overview
Show Company Profile
Bajaj Finance Limited operates as a deposit-taking non-banking financial company in India. The company offers financing for various products, such as consumer electronics, furniture, digital products, e-commerce purchases, retail spends, and two and three-wheelers; and personal, unsecured, home, and secured, gold, and car loans. It also provides secured and unsecured loans to micro, small, and medium enterprises, SMEs, and professionals; loans against property, mutual funds, insurance policies, and shares; developer finance and lease rental discounting services; and new and used car financing, and tractor financing. In addition, the company offers commercial and rural lending; public and corporate deposits; loans against securities; micro-finance and auto financing lending; and broking and margin trade financing services. Further, it distributes life, health, and general insurance products. The company was formerly known as Bajaj Auto Finance Limited and changed its name to Bajaj Finance Limited in September 2010. The company was incorporated in 1987 and is based in Pune, India. Bajaj Finance Limited is a subsidiary of Bajaj Finserv Ltd.