Bajaj Finance Q2 Results: Profit Rises, Asset Quality Sours

Bajaj Finance Ltd. reported a solid rise in net profit and interest income in the second quarter of the current financial year, even as asset quality soured.

Consolidated profit rose 22% year-on-year to Rs 4,875 crore in the July-September quarter, as per results announced on Monday, compared to an estimate of Rs 4,969 crore.

Net interest income also jumped 22% to Rs 10,785 crore, against a forecast of Rs 10,955 crore. Pre-provisioning operating profit increased by 21%.

Asset quality worsened, with the share of gross non-performing loans rising to 1.24% from 1.03% in the previous quarter. Net NPA came in at 0.60% versus 0.50% in the June quarter. Loan losses and provisions increased by 19%.

"Consumer leverage remains an area of concern. The company continues to take ongoing actions to reduce the contribution of customers with multiple loans. The vintage credit performance, as a result, are significantly better except for MSME," Bajaj Finance said in a statement.

Credit cost remained elevated in captive 2 and 3-wheeler and MSME businesses. The company reduced 25% of its unsecured MSME volumes and thus AUM growth for MSME lending will be 10-12% in FY26, the statement added.

The total assets under management rose 24% year-on-year to Rs 462,261 crore.

The company witnessed strong momentum in consumption finance during the festive season (Navratri to Diwali), disbursing a record 6.3 million consumer loans, recording a growth of 27% in volume and 29% in value as compared to the same period last year. Structural reforms in income tax and GST by the Government lifted-up consumer sentiment and spurred consumption.

Bajaj Finance shares closed 1.8% at Rs 1,085.4 apiece on the BSE, ahead of the results, compared to a 0.4% rise in the benchmark Sensex.