India's Bajaj Finance jumps to record as strong Q3 earnings light up growth path

Bajaj Finserv

30/01/2025 05:20

Jan 30 (Reuters) - Shares of India's Bajaj Finance
 BJFN.NS  rose as much as 6% to an all-time high on Thursday, a
day after the non-bank lender reported a quarterly profit surge
because of solid loan growth, which analysts said augurs well
for its earnings next year.
    Bajaj Finance and its holding company Bajaj Finserv
 BJFS.NS , trading higher by 2.6% and 1.3%, respectively, were
among the top gainers in India's benchmark Nifty 50 index
 .NSEI , which was up 0.6% as of 10:33 a.m. IST.  
    The lender's profit surged 18% year-on-year in the three
months to Dec. 31 and it forecast a profit growth of 22% to 23%
for the fiscal year ending March 2026.
    At least 12 analysts raised their target prices for Bajaj
Finance after the results, with the median price target rising
to 8,500 rupees from 8,110 a month ago, according to data
compiled by LSEG. 
    The performance has set the company up for strong earnings
growth in 2025-2026, Morgan Stanley analysts said in a note,
which makes the lender an "interesting large-cap in a tough
market."
    Several Indian lenders have been grappling with asset
quality stress, led by unsecured lending such as credit cards
and personal loans.
    Meanwhile, Bajaj Finance's asset quality trends are
stabilising after a short period of surge over the past few
quarters, Jefferies said in a note.
    Its shares have risen more than 17% so far in January,
compared with a 1.6% fall in both the Nifty 50 and the finance
index  .NIFTYFIN . 
    Bajaj Finance saying that its managing director and veteran
leader Rajeev Jain will stay involved with the company after his
tenure ends in March is a "smooth succession move" that could
drive interest in the stock in the short-term, Morgan Stanley
said. 

 (Reporting by Sethuraman NR; Editing by Mrigank Dhaniwala)
 ((Sethuraman.NR@thomsonreuters.com; (+91 9945291420); Reuters
Messaging: nallur.sethuraman.thomsonreuters.com@reuters.net))