Shares of Bajaj Finance surged 6 percent to hit a record high of Rs 8,250.65 on January 30, bolstered by the company's upbeat quarterly earnings. The non-bank finance lender's solid Q3 earnings show also turned leading brokerage upbeat on Bajaj Finance, with projections of 22 percent profit growth in FY26 along with a 25 percent AUM growth projection. These robust growth projections from brokerages further cemented investor sentiment for the stock, adding to the strong buying momentum.
At 09.36 am shares of Bajaj Finance were trading at Rs 8,157.50 on the NSE.
Bajaj Finance reported an 18 percent on-year growth in its consolidated net profit for Q3 FY25 to Rs 4,308 crore, topping analysts' expectations. The strong performance was driven by a significant rise in assets under management (AUM). A Bloomberg poll of analysts had projected Bajaj Finance's Q3 net profit of Rs 4,136 crore.
The company’s net interest income (NII) for the quarter grew by 23 percent, coming at Rs 9,382 crore, up from Rs 7,655 crore in Q3 FY24. This growth was largely fueled by a robust 28 percent surge in AUM, which climbed to Rs 3.98 lakh crore as of December 31, 2024, compared to Rs 3.11 lakh crore during the same period last year.
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Morgan Stanley has maintained an 'Overweight' on Bajaj Finance, raising their target price to Rs 9,300 per share. The note said lower stressed asset formation seen in Q2 was sustained in Q3, and the management has guided for lower credit costs in Q4FY25. Improved visibility of +25% EPS growth in FY26 is expected, subject to macroeconomic conditions.
Jefferies has given a 'Buy' call with a target price of Rs 9,270 per share. Asset quality trends are stabilizing, said Jefferies, and management expects credit costs to taper off from Q4FY25. CEO succession is likely to be smooth, with the Deputy CEO expected to be elevated while Rajeev Jain remains involved.
Nomura too has issued a 'Buy' call, raising the target price to Rs 9,000 per share. The company delivered a steady quarter, with 18% on-year and 7% QoQ profit growth in Q3FY25, supported by strong loan growth. Profit exceeded estimates due to lower credit costs at 2.1%, while operating profit was largely in line, driving Return on Assets (RoA) and Return on Equity (RoE) at 4% and 19%, respectively.
Read More: Bajaj Finance Q3 net rises 18% YoY to Rs 4,308 crore, supported by AUM growth
HSBC has upgraded its target price to ₹8,900 per share with a "Buy" call. The company delivered on all key parameters in Q3, with broad-based AUM growth and better-than-expected asset quality. While HSBC made slight tweaks to its earnings estimates, it believes Bajaj Finance shares deserve a premium over peers and has raised its price-to-book value (P/BV) multiple to 5x for FY26.
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