Bajaj Finance (BAF IN) – Q3FY26 Result Update – Steady growth; accelerated provision in Q3 – BUY
Published on 04 Feb 2026
AUM grew steady at 22% YoY to Rs4,844.8bn led by strong growth in mortgages, sales finance and consumer B2C. Company is seeing strong traction in new verticals (Cars, Gold, MFI) and new customer addition (~17-18 mn in FY26) and we build an AUM growth of 23%/24% in FY26/FY27E. Expect FY26 NIM to remain stable aided by a lower cost of borrowing. Asset quality ratios stood flat as stress persists in the captive auto/ MSME portfolio. Credit cost remained elevated in the quarter (3.1%) due to accelerated provisions; however commentary indicated a healthy trend in early-stage delinquencies and expects a moderation in FY27E. We slightly tweak our estimates to account for higher credit cost and roll-forward to Mar-28E with a multiple of 4.2x and an unchanged TP of Rs 1,125. Maintain BUY on recovery in growth and credit cost outlook in FY27E.
