Buy Bajaj Finance; target of Rs 1125: Prabhudas Lilladher

Prabhudas Lilladher is bullish on Bajaj Finance has recommended buy rating on the stock with a target price of Rs 1125 in its research report dated February 04, 2026.

Broker Research

February 04, 2026 / 11:56 IST

Buy

Prabhudas Lilladher's research report on Bajaj Finance

AUM grew steady at 22% YoY to Rs4,844.8bn led by strong growth in mortgages, sales finance and consumer B2C. Company is seeing strong traction in new verticals (Cars, Gold, MFI) and new customer addition (~17-18 mn in FY26) and we build an AUM growth of 23%/24% in FY26/FY27E. Expect FY26 NIM to remain stable aided by a lower cost of borrowing. Asset quality ratios stood flat as stress persists in the captive auto/ MSME portfolio. Credit cost remained elevated in the quarter (3.1%) due to accelerated provisions; however commentary indicated a healthy trend in early-stage delinquencies and expects a moderation in FY27E.

Outlook

We slightly tweak our estimates to account for higher credit cost and roll-forward to Mar-28E with a multiple of 4.2x and an unchanged TP of Rs 1,125. Maintain BUY on recovery in growth and credit cost outlook in FY27E.

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