More Stories

Informist, Monday, Nov. 10, 2025

 

By Arya S. Biju

 

MUMBAI – Strong growth in assets under management and lower cost of borrowings due to cuts in the Reserve Bank of India's repo rate are expected to boost Bajaj Finance Ltd.'s bottom line for the September quarter. The company's net interest margin is also widely expected to improve in the latest quarter, according to brokerages. 

 

The non-banking finance company's consolidated net profit for the September quarter is expected to rise around 28% on year to INR 51.16 billion, according to the average of estimates from eight brokerages. This will mark the highest on-year growth in its bottom line in nine quarters. Sequentially, the bottom line is seen rising 9%. The highest estimate of INR 57.65 billion for the company's net profit is from Nirmal Bang Equities Pvt. Ltd. and the lowest of INR 48.88 billion is from Motilal Oswal Financial Services Ltd. 

 

The net interest income of the company is seen rising around 33% on year to INR 117.35 billion, according to the average of estimates. Sequentially, the metric is expected to grow around 15%. The highest estimate of INR 133.38 billion for the metric is from Emkay Global Financial Services Ltd. and the lowest of INR 107.53 billion is from Motilal Oswal. 

 

The assets under management of Bajaj Finance grew 24% on year to INR 4.62 trillion as on Sept. 30, according to provisional data from the company. In the September quarter, the assets under management grew by around INR 208 billion. The company's new loans booked increased 26% on year to 12.17 million in the September quarter from 9.69 million in the corresponding quarter a year ago. 

 

The company's net interest margin for the reporting quarter is expected to improve both sequentially and on a year-on-year basis to 9.7-9.9%, estimates from three brokerages showed. "We expect margins to improve sequentially on moderating CoFs (cost of funds), led by rate-cut benefit starting to reflect this quarter," Emkay Global said. Meanwhile, Motilal Oswal expects the net interest margin to remain stable on a sequential basis at around 9.55% and JM Financial Institutional Securities Ltd. expects it to decline slightly on year but improve on quarter to 9.6%. 

 

The benefits of rate cuts by the Reserve Bank of India and gradual reduction in the marginal cost of funds-based lending rate by banks are expected to be more pronounced for smaller non-banking finance companies than larger ones such as Bajaj Finance, which has been moving away from the banking system for funding, Kotak securities said. In the June quarter, borrowings from banks constituted around 26% of its total borrowings, lower than the 28% in 2024-25 (Apr-Mar), the brokerage said. It expects the company's cost of funds to decline about 10 bps on quarter compared to the 5-30 bps reduction it expects for the non-banking finance companies under its coverage. After announcing its June quarter earnings, the company had said it expects its cost of funds to be 7.60-7.65% for the rest of the current financial year. 

 

Bajaj Finance's credit cost for the quarter is expected to remain largely stable on a sequential basis at 2% as stress in the micro, small and medium enterprises portfolio persists, brokerages said. Emkay Global and Nirmal Bang Equities, however, expect a slight sequential dip in the metric to 1.93% and 1.9%, respectively. 

 

The company had been offering its customers to restructure their loans to relieve some of the stress in the MSME portfolio. The management had said in July said it expects to restructure loans of around INR 1.50 billion in Jul-Sept. 

 

Analysts remain divided on Bajaj Finance's cost-to-income ratio, a metric that shows the efficiency of a company in managing its expenses in relation to its income. While Emkay and Kotak Securities expect this metric to decline on a year on-year basis to 31.7% and 32.9%, respectively, Prabhudas Lilladher Pvt. Ltd. expects it to improve both sequentially and on year to 33.4%. 

 

Management commentary on the trajectory of the net interest margin and credit costs will be key monitorables, Motilal Oswal said. Bajaj Finance is scheduled to release its September quarter earnings Monday. On Friday, shares of the company closed over 2% higher at INR 1,066.60 on the National Stock Exchange. The stock has risen around 17% since it announced its June quarter earnings on Jul. 24.  

 

For the quarter ended June, Bajaj Finance reported a consolidated a net profit of INR 47.00 billion, up 20% on year. Its net interest income for the quarter rose 22% on year to INR 102.27 billion.   

 

Of the 18 brokerage reports on Bajaj Finance available with Informist, 14 have a 'buy' rating on the sock with an average target price of INR 977, and the rest have a 'hold' rating with an average target price of INR 970.

 

Following are the September earnings estimates for Bajaj Finance from eight brokerage firms in descending order of the estimate of net profit in INR million:

 

Brokerage	NII	Net profit
Nirmal Bang Equities Pvt. Ltd.	109,803	57,649
Prabhudas Lilladher Pvt. Ltd.	112,010	52,980
Emkay Global Financial Services Ltd.	133,384	51,439
Anand Rathi Share and Stock Brokers Ltd.	125,771	50,014
JM Financial Institutional Securities Pvt. Ltd.	108,622	49,823
YES Securities (India) Ltd.	132,186	49,444
Kotak Securities Ltd.	109,486	49,019
Motilal Oswal Financial Services Ltd.	107,528	48,881
Average	117,348.75	51,156.13

 

End

 

Edited by Avishek Dutta

 

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

 

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd. by NSE Data & Analytics Ltd., a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt. Ltd.

 

Informist Media Tel +91 (22) 6985-4000

Send comments to feedback@informistmedia.com

 

© Informist Media Pvt. Ltd. 2025. All rights reserved.