Bajaj Finance Shares Jump Most In 10 Months After RBI Lifts Restrictions

Shares of Bajaj Finance Ltd. jumped on Friday the most since last July after the Reserve Bank of India lifted restrictions on its ECom and Insta EMI Card products.

The reversal of the RBI's restrictions has happened based on the remedial actions taken by the company. However, it did not specify the nature of actions taken, according to a statement by Bajaj Finance.

"The recent development in the beginning of FY25 itself is a positive start for BAF for the fiscal, and is expected to boost investor confidence on processes, commitment of management in making things right, and company's ability to adapt to the changing regulation & business environment," Emkay Global said.

The brokerage maintains its 'buy' rating for the stock and a target price of Rs 9,000 apiece.

Citi Research also maintains its 'buy' call and a target price of Rs 8,675 apiece. "We believe rectification of deficiencies and ensuring lifting of restrictions in a span of five months is commendable."

Citi said the management remains committed to avoiding recurrence of regulatory restrictions and has assumed lifting of restrictions in the near future in its guidance. "Withdrawal (of RBI curbs) in May itself, raises visible towards the upper end of guidance," it said.

On the NSE, the stock rose as much as 7.52% during the day to Rs 7,400 apiece, the highest since April 24. It was trading 6.54 % higher at Rs 7,332.80 per share, compared to a 0.54% advance in the benchmark Nifty 50 at 9:54 a.m.

The share price has risen 0.56% on a year-to-date basis and 5.46% in the last 12 months. The total traded volume so far in the day stood at 1.40 times its 30-day average. The relative strength index was at 60.

Twenty-nine out of the 37 analysts tracking the company have a 'buy' rating on the stock, five recommend 'hold' and three suggest 'sell', according to Bloomberg data. The average of 12-month analyst price targets implies a potential upside of 14.8%.