Neutral Bajaj Housing Finance; target of Rs 120: Motilal Oswal

Motilal Oswal's research report on Bajaj Housing Finance

Bajaj Housing Finance (BHFL) is the fastest-growing and the second-largest HFC in India, with a five-year AUM CAGR of ~29% over FY20-FY25. It had an AUM of INR1.2t as of Jun’25. BHFL is the most diversified HFC in the country, offering a comprehensive suite of mortgage products that cater to a broad spectrum of customers, ranging from individual homebuyers to large-scale developers. To further strengthen its presence, BHFL has also introduced an affordable housing segment, positioning itself to serve the entire housing finance ecosystem.

Outlook

BHFL trades at 3.6x P/BV and ~29x FY27E P/E, which is a ~60% premium to its IPO price. We model AUM/PAT CAGR of ~22% each over FY25-28E, with an RoA/RoE of 2.3%/14% in FY28E. We initiate coverage on BHFL with a Neutral rating and a TP of INR120 (premised on 3.6x Sep’27E P/BV).

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