Bajaj Finance
Highest-ROE scaled lender
- Last close
- ₹973.80
- 29 Sept 2026 · reference
- 1D · 1M
- −1.1% · −9.8%
- price-only
- Weight
- 3.5%
- 31 Jul 2026 · Aug rank 5
- Thesis review
- 8 Sep 2026
- Why We Own, p40
Approved description
India's largest private-sector NBFC, lending to retail, SME and commercial customers across urban and rural India with a consolidated AUM of Rs 5.47 lakh crore (Jun-2026, +24% YoY) and 16.1 million new loans booked in Q1FY27 alone. It owns 86.7% of Bajaj Housing Finance (AUM Rs 1.50 lakh crore) after selling 2% in Dec-2025, and books around 18-20 million new customers a year. Its consumer-durable/EMI-card franchise, cross-sell ecosystem and 9.6% NIM give it best-in-class ROA (FY27 guidance 4.3-4.7%) among large Indian lenders.
- 01Growth engine intact: AUM +24% YoY to Rs 5.47 lakh cr in Q1FY27 with FY27 guidance of 23-25% AUM and 23-24% PAT growth; new customer target raised to 18-20 mn.
- 02Credit cycle turning: annualised credit cost fell to 1.54% in Q1FY27 (1.31% ex-provisions) from FY26 guidance of 1.85-1.95%; GNPA 0.96%, NNPA 0.39%; FY27 corridor 1.45-1.60%.
- 03Self-inflicted stress is behind: unsecured MSME volumes were cut 25% in Nov-2025 (MSME AUM growth 2-6%) and captive 2W/3W (1.5% of AUM but 9% of losses) is phased out to <1% of AUM; gold loans (+112% to Rs 21,152 cr) and CV/tractor (+102%) replace them.
- 04Best-in-class profitability: NIM 9.6% (Q4FY26), FY27 ROA guidance 4.3-4.7% and ROE 19-21% (annualised 20.4% in Q1FY27) versus Chola/Shriram in the 16-19% ROE range.
- 05Leadership continuity: Rajeev Jain reinstated as Executive Vice-Chairman & MD until 31-Mar-2028 after MD Anup Saha resigned on 21-Jul-2025; 16 of 21 brokers rate it Buy (Bloomberg consensus TP Rs 1,145).
Reference close, with results-period markers
- 1Q Sep-25 end · 30 Sept 2025
- 2Q Dec-25 end · 31 Dec 2025
- 3Q Mar-26 end · 31 Mar 2026
- 4Q Jun-26 end · 30 Jun 2026
Quality score, technicals and Buoyant Score
Computing the scorecard…
Latest quarter · Q Jun-26
| Line (₹ cr) | Q Jun-26 | YoY | QoQ |
|---|---|---|---|
| Net Profit | 5,986 | +27.4% | +9.5% |
Reported vs internal estimate: internal quarterly estimates are not in the supplied package; consensus feed not licensed. YoY/QoQ per PRD §12.5 (transitions, not %, on non-positive bases).
Position and valuation context
NBFC preset: AUM/loan growth, spreads, asset quality, leverage, ROA/ROE; P/B and P/E.
Sell-side targets are third-party views, not Buoyant's; the upside is recomputed on our reference close, so it differs from the figure printed at the broker's price date.
Valuation range
No headline target on this page; the book quotes the thesis and the risk rather than a target.
What we watch
- Q2FY27 results (late Oct-2026): possible downward revision of FY27 credit-cost corridor (1.45-1.60%) if MSME normalises as guided (double-digit growth by H2FY27).
- Further Bajaj Housing Finance stake sale to meet minimum public shareholding (holding 86.7% after Dec-2025 2% sale at Rs 95.31; ~Rs 1,588 cr raised) - special dividend precedent (Rs 0.60/share in FY26).
- RBI rate-cut transmission lowering cost of funds (7.40% consolidated in Q1FY27) and any easing of unsecured-loan risk weights.
- Valuation: 5.8x book and ~32x TTM leaves little room for a miss; Bernstein (Underperform, Rs 840), Macquarie (Sell, Rs 850) and Ambit (Sell, Rs 815) argue the multiple caps upside.
- Renewed unsecured stress: MSME book still growing only +2% YoY and management wants 'another quarter' before revising credit-cost guidance; West-Asia conflict/geopolitical shocks could re-ignite retail delinquencies.
- Succession: Rajeev Jain's term runs only to Mar-2028 after the abrupt Jul-2025 exit of MD Anup Saha; a second leadership reset in 18 months would hit the multiple.