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Bajaj Finance gained 45% in 2025, outperforming the Nifty Financial Services Index's 13% rise
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The stock rose 12% in the past month and 11% over six months, beating sector gains
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From 2015 to 2025, Bajaj Finance grew profit at a 34% CAGR and assets at 29% CAGR
Bajaj Finance has been the standout on the Nifty this year, delivering a 45% gain so far in 2025. The rally has left the broader Nifty Financial Services Index far behind, with that gauge up just 13% over the same period.
The stock has also rewarded investors in the short term. It added 12% over the past month and climbed 11% in six months, against the sector’s rise of 1% and 8%. Longer-term shareholders have seen even greater wealth creation.
Ten Years Of Growth
From 2015 to 2025, Bajaj Finance’s stock moved from Rs 60 to Rs 1,006, a compounded annual growth rate of 33%.
The company grew both profit and assets at a rapid pace. Profit after tax rose from Rs 898 crore in 2015 to Rs 16,661 crore in 2025, reflecting a 34% CAGR. Assets under management expanded from Rs 32,410 crore to Rs 4.17 lakh crore in the same period, a 29% CAGR.
It has finished eight of the past ten calendar years with positive returns. Even in 2022 and 2024, when the stock fell, the recovery was swift, as shown by this year’s gains.
Pressure n IFY25
FY25 has brought fresh challenges. In the September quarter, management raised its credit cost guidance to 2–2.05%, from 1.75–1.85% in the previous quarter. The revision unsettled investors and triggered a 15% fall in the share price between September and October 2024.
Leadership changes also weighed on sentiment. Rajeev Jain, who had steered the company as managing director and chief executive, moved to Bajaj Finserv, leaving Bajaj Finance without a permanent head. At the same time, credit quality concerns emerged in the two-wheeler and three-wheeler loan book.
Long-Term Targets
Despite near-term hurdles, the company has kept its longer-term guidance intact. Management expects assets under management to grow by 25–27% and profit by 23–24%. Gross non-performing assets are projected between 1.2% and 1.4%, with net NPA at 0.4–0.5%. Return on assets is targeted at 4.3–4.7% and return on equity at 19–21%.
Looking Ahead
For FY25, credit costs ended at 2.07%, matching revised guidance. For FY26, management expects the figure to ease to 1.85–1.95%. It also projects margin gains as consumption improves in the wake of GST-related reforms.
Valuation remains a concern. The stock trades at 6.44 times current price-to-book, below its five-year average of 7.24 times but still expensive when compared with peers. On a forward basis, the valuation looks lower at 5.02 times one-year forward price-to-book.
Analyst Ratings: Room For Pause?
Brokerages are cautious on further upside. Consensus data show 21 buy ratings, 13 hold, and 5 sell. The average expected return is -1.3%, suggesting that near-term gains may already be reflected in the price.
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