Key Takeaways
- Bajaj Finance shares plunged 8% after Q2 results and cautious management outlook
- Company revised FY26 AUM growth forecast downward from 24-25% to 22-23%
- Credit costs expected to remain elevated, asset quality concerns rising
Bajaj Finance shares crashed nearly 8% on Tuesday, hitting an intraday low of ₹1,003.40, as investors reacted negatively to the company’s quarterly results and revised growth guidance.
The NBFC reported strong Q2FY26 numbers with profit after tax rising 22% to ₹4,875 crore and net interest income growing 22% to ₹10,785 crore. However, management commentary overshadowed these results.
Growth Forecast Cut Sparks Concern
Bajaj Finance lowered its FY26 assets under management growth projection to 22-23% from the earlier 24-25%, citing increasing stress in MSME and two-wheeler loan portfolios. The company also indicated credit costs would remain at the higher end of its range through the year.
Asset quality showed deterioration with gross NPAs rising to 1.24% from 1.06% a year earlier. Net NPAs climbed to 0.60% from 0.46%, while loan provisions increased 19% to ₹2,269 crore.
Analyst Views Divided
While Bajaj Finance remains one of India’s most efficient lenders, its valuation premium faces pressure. The stock trades at nearly five times FY27 estimated book value, leaving little room for disappointment.
Brokerages are split on the outlook. Morgan Stanley and Jefferies see the correction as a buying opportunity, while Motilal Oswal and JM Financial have turned cautious about near-term performance.
The sharp selloff reflects shifting market sentiment from unwavering optimism to careful watchfulness. The company’s next few quarters will determine whether this is a temporary setback or the beginning of a slower growth phase for India’s premier NBFC.
