Sharekhan's research report on Bajaj Finance
Q4 earnings were mainly aided by fee income/ treasury gains/other income offsetting weak NII/ higher opex (one off), supporting the return ratios. Asset quality improved, led by contained slippages and higher write-offs. Credit cost was higher on low base but remained within guided range. Loan / deposit growth was modest at 12% y-o-y/9% y-o-y, respectively. NIMs were stable q-o-q, although the outlook on NIMs is negative. Bank slightly lowered loan growth guidance to 12% for FY26E vs 14% earlier but is confident of maintaining RoA at ~1% going ahead.
Outlook
We maintain a Buy with an unchanged PT of Rs. 980 as there are no emerging concerns on asset quality and expect the bank to sustain RoA/RoE at ~1%/14-15% in the near to medium term. We acknowledge that core operating profitability would be under pressure in FY26E but that has already been priced in. Stock trades at 1.0x/0.9x its FY2026E/FY2027E core BV estimates.
For all recommendations report, click here
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
Find the best of Al News in one place, specially curated for you every weekend.
Stay on top of the latest tech trends and biggest startup news.
