Bajaj Finance shares hit a new 52-week high on Friday, but the rally is not just about a strong quarterly earnings beat. Investor interest is being fuelled by the expectation that the NBFC is heading for its next phase of long-term growth based on improved asset quality and reduced credit cost, along with business expansion.
The stock surged to Rs 1129 during intraday trade, hitting a fresh 52-week high. Later at 11:30 am, the stock was at Rs 1,134.20, with an increase of 80.70 (7.66%) over and above the previous close of Rs 1053.50. The market cap of the company has already skyrocketed to about Rs 7.06 lakh crore, the highest among the top financial services companies in India.
Friday’s move was driven by June quarter earnings, but the market’s reaction suggests investors are looking beyond one quarter.
Why Investors Are Shrugging Off Profit Growth
Companies’ earnings reports can make for a good 1-day rally but what the street actually looks for is comfort in future growth to carry on with this. Bajaj Finance is yet another example. The financier also presented an encouraging Q1 result, with consolidated net profit jumping 27% YoY to Rs 5,986 crore, substantially beating Street forecasts.
Net interest income (NII) rose 23% at Rs 12,571 crore.
Profitability remains impressive given fierce competition in the business environment. Crucially, asset quality remains stable to better-than-expected. GNPA edged down to 0.96% from 1.03%, with net NPA down to 0.39% from 0.50%. The recovery in the quality of earnings, not just the growth of earnings, has been bolstered by lower credit costs and healthier loan repayments, which has boosted investors’ confidence.
For lenders, cleaner books often mean better profitability over several quarters, not just one reporting period.
Brokerages Bet On Next Earnings Cycle
The better-than-expected quarter has led several brokerages to boost their expectations for the stock, but their optimism extends beyond the quarterly numbers.
Motilal Oswal upgraded Bajaj Finance to a “Buy” with a target of ₹1,300, saying the company is performing strongly and entering a new cycle of earnings. The broker said better assets under management (AUM) growth, improving profitability and lower credit costs are expected to help future earnings.
CLSA also raised its target to 1,300 rupees and maintained its “Outperform” rating. Bajaj Finance was called the “Iron Man” of the NBFC space after it beat expectations for profit, operating performance and asset quality.
Citi has retained its ‘Buy’ rating and raised the target price to ₹1,300, buoyed by return on assets of 4.7%, return on equity of over 20% and steady lending margins in a competitive environment.
HSBC raised the target to ₹1,270 on broad-based growth across lending segments and continued improvement in credit quality.
Nomura kept its ‘Buy’ rating with a target price of ₹1,140, saying management may review guidance after another quarter if favourable trends persist.
But not everyone is convinced. Despite the strong operational performance, Bernstein retained its “Underperform” rating with a target price of ₹840, saying that the optimism could be priced in already.
Market Looks Beyond Q1 to FY27
Perhaps the biggest lesson from earnings season was the confidence management showed about the road ahead.
The company said that the growth momentum in FY27 continues and indicated that it might revise its guidance after the September quarter if the current trends continue.
It also raised its annual customer acquisition goal to 18-20 million from the previous 15-17 million, signalling confidence in demand. Expansion plans in gold loans, digital financial services and two new businesses expected by early 2027 have further strengthened the long-term growth story.
Assets under management grew 24% year on year and underlying credit costs fell to around 1.3%, which gave the firm more room to grow without doing much damage to profitability.
What A 52-Week High Really Means
The new 52-week high isn’t just a reaction to better-than-expected earnings. This indicates that the market believes Bajaj Finance could be on the cusp of another phase of sustainable earnings growth.
Asset quality is improving, and provisioning is falling. Lending businesses are growing, and multiple brokerages are forecasting further upside. Investors appear to be pricing in a stronger FY27 rather than simply celebrating one strong quarter.
Whether the company can turn that optimism into consistent earnings growth over the next few quarters will determine if the stock can continue its record-breaking run.
(Disclaimer: This article is for informational purposes only and should not be considered investment advice. The views, opinions, and recommendations expressed herein are those of the respective experts. Readers are advised to consult a qualified financial advisor before making any investment decisions.)
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Priyanka Roshan is a business writer and assistant editor at the NewsX website who tracks everything from stock market swings and corporate earnings to personal finance trends and policy shifts. Known for turning fast-moving business developments into sharp, reader-friendly stories, she combines speed, accuracy, and a data-driven approach to break down complex financial news for everyday audiences.
With over 9.5 years of newsroom experience, Priyanka has worked with leading media organisations, including Bussiness, Times Now, and Ping Digital, covering diverse beats such as business, politics, technology, auto, travel, sports, and the world. From live breaking news desks to SEO-led digital storytelling, she specialises in creating engaging content that keeps readers informed without overwhelming them.
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