Why Bajaj Finance Share Price is Rising

The Non-Banking Financial Company (NBFC) industry in India plays a crucial role in lending and financial services. It complements traditional banks by providing credit to individuals and businesses.

The sector has seen strong growth due to rising demand for loans, digital lending, and government support. With increasing financial inclusion, NBFCs have gained importance in India's economy.

One of the biggest names in th sector is Bajaj Finance. It is a leading NBFC that offers consumer loans, business loans, and asset management services.

The company has a strong presence in retail lending, with a wide customer base. Its ability to innovate and expand into new financial services has made it a market leader.

Recently, Bajaj Finance's share price has been in focus. It has surged 10% in the last five days, attracting investor attention.

Read on to understand the factors driving Bajaj Finance's recent stock price surge.

Strong Q3 Performance

Bajaj Finance share price is rising significantly, driven by its robust financial performance in the third quarter of FY25. The company reported a consolidated net profit of Rs 43.1 billion (bn), an 18.4% increase from Rs 36.4 bn in the same period last year. This growth is attributed to higher net interest income and effective cost management.

The net interest income (NII) rose 23% year-on-year (YoY) to Rs 93.8 bn, up from Rs 76.6 bn. This increase resulted from a substantial rise in assets under management (AUM) and efficient lending practices.

Assets under management expanded 28%, reaching Rs 4 trillion (tn) as of 31 December 2024, compared to Rs 3.1 tn the previous year. This growth was driven by strong demand across various loan segments.

The number of new loans booked reached a record 12.1 million (m), a 22% increase from 9.9 m in the prior year. This surge indicates heightened consumer demand and the company's effective customer acquisition strategies.

However, loan losses and provisions rose to Rs 20.4 bn from Rs 12.5 bn, reflecting a cautious approach to potential credit risks.

The gross non-performing assets (NPA) ratio increased to 1.1% from 0.9%, while the net NPA ratio went up to 0.5% from 0.4%. These upticks suggest a slight deterioration in asset quality, prompting the company to bolster its provisioning coverage.

The company's cost of funds stood at 7.9%, showing a marginal decline of 1 basis point from the previous quarter. This stability indicates effective management of borrowing costs.

In summary, Bajaj Finance's impressive Q3 results, characterised by significant growth in profit, NII, and AUM, have instilled investor confidence, leading to a notable rise in its share price.

What Next?

Bajaj Finance is focused on expanding its digital reach, customer base, and product offerings under its long-term strategy.

The company plans to increase its customer franchise from 97.1 m to 190-210 m by FY29, with cross-sell customers rising to 115-125 m. Its geographic presence will expand to 5,500 locations, supported by AI-driven customer engagement and digital lending.

The company's digital ecosystem will play a major role in this, as it anticipates net app installs to reach 150-170 m and web visitors to grow significantly?.

To drive efficiency, the company is integrating 29 AI-based solutions across its operations, aiming to save Rs 1.5 bn annually by FY26.

It is also strengthening cybersecurity with a "Zero Trust" model and moving to a multi-cloud infrastructure for better scalability.

In addition, Bajaj Finance is entering the green finance market, targeting Rs 20 bn in green financing by FY26 for solar and EV products.

By FY29, the company expects to maintain a return on equity of 20-22% and return on assets of 4.6-4.8%, with AUM per cross-sell customer projected to grow from Rs 64,700 to Rs 85,000.

Investors should evaluate the company's fundamentals, corporate governance, and valuations of the stock as key factors when conducting due diligence before making investment decisions.

How Bajaj Finance Share Price has Performed Recently

In the past five days, Bajaj Finance share price has rallied 10%. In the last month, it has surged 13.5%.

In the last six months its share price is up 26.5%. Additionally, in the last year its share price has rallied 26.6%.

The stock touched its 52-week high of Rs 8,457 on 4 February 2025 and a 52-week low of Rs 6,190 on 6 March 2024.

About Bajaj Finance

Bajaj Finance, a subsidiary of Bajaj Finserv, is one of the largest non banking finance companies (NBFC) in India. It is engaged in lending to retail, SME, and commercial customers.

Bajaj Finance's products include consumer lending, mortgages, personal loans, SME lending, gold loans, auto financing, rural lending, commercial lending, and microfinancing. The company also accepts deposits from public and corporate clients.

It is one of the largest companies in the consumer lending space, especially electronics. The company has a presence in over 4,100 locations with over 134,000 distribution points of sale.

It has one of the largest customer bases of over 83 million (m) and manages assets of over Rs 3,306 billion (bn).

The company's subsidiaries Bajaj Housing Finance and Bajaj Financial Securities are established players in in housing finance and stock broking space.

For more details, see the Bajaj Finance company fact sheet and quarterly results.

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Happy Investing.

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