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Informist, Tuesday, Jul. 28, 2026

 

By Kabir Sharma

 

MUMBAI – Bajaj Housing Finance Ltd. is expected to report a healthy growth in net profit for the June quarter, supported by robust expansion in assets under management, healthy loan disbursements, and continued strength in asset quality. While analysts expect margins to remain under some pressure because of lower lending rates, the company's strong balance sheet, benign credit costs, and disciplined operating expenses are likely to support double-digit growth in both net interest income and net profit.

 

Bajaj Hosing Finance is estimated to report a net interest income of INR 9.91 billion, up 11.8% on year and 4.8% sequentially, as per the average estimate of six brokerages. Net profit is expected at INR 6.86 billion, representing 17.7% on-year growth and a 0.6% sequential increase. Among the brokerages, PhillipCapital (India) Pvt. Ltd. has the most optimistic estimate for both key earnings metrics. It expects net interest income of INR 10.66 billion and net profit of INR 7.39 billion. On the other hand, ICICI Securities Ltd. has the lowest estimate for net interest income at INR 9.62 billion and Kotak Securities Ltd. has the lowest estimate for net profit at INR 6.41 billion. 

 

A key driver of earnings for Bajaj Housing Finance is expected to be continued expansion in the loan book. PhillipCapital expects assets under management to grow more than 30% on year, reflecting sustained demand across the housing finance segment. Kotak Securities is relatively more conservative but still expects assets under management to increase 22% on year and 4.7% sequentially, while Motilal Oswal Financial Services Ltd. estimates 24% on-year and 6.3% sequential growth in the June quarter. 

 

Margin is likely to remain the primary area of focus during the earnings announcement. Motilal Oswal expects net interest margin to decline around 10 basis points sequentially to about 3.05%. In contrast, Kotak believes spreads should remain broadly stable, supported by stable borrowing costs and lending yields.

 

Despite some pressure on margin, analysts continue to expect asset quality to remain one of Bajaj Housing Finance's biggest strengths. PhillipCapital expects credit costs to remain benign, while Motilal Oswal forecasts credit costs of around 15 bps. Kotak Securities estimates credit costs at 14 bps, broadly in line with the levels seen over the previous four quarters. 

 

Brokerages also expect the company to maintain tight control over operating expenses. Kotak forecasts operating expense growth of only 6% on year, which would keep the cost-to-average assets under management ratio around 0.63%, largely unchanged from recent quarters. 

 

The June quarter expectations follow a comparatively softer March quarter, when Bajaj Housing Finance reported its slowest on-year profit growth in at least six quarters. For the March quarter, the company had posted net profit of INR 6.69 billion, up more than 14% on year, but marginally below the estimated INR 6.91 billion.

 

Within its portfolio, lease rental discounting continued to be the fastest-growing segment in the March quarter, recording 44% on-year growth in assets under management. Loans against property increased 24%, while the company's largest business segment, home loans, expanded 18% on year to INR 760.55 billion. The diversified growth profile provides comfort that the company is not overly reliant on any single lending category.

 

Asset quality remained exceptionally strong in the March quarter, with the gross non-performing asset ratio improving to 0.27% from 0.29% a year earlier, while the net non-performing asset ratio remained unchanged at 0.11%. The provisioning coverage ratio on stage-three assets stood at 59.78%, demonstrating continued prudence in provisioning. Meanwhile, the capital adequacy ratio remained comfortable at 22.46%, providing ample headroom to sustain loan growth.

 

Bajaj Housing Finance will detail its June quarter results Wednesday. On Tuesday, its shares closed 0.2% higher at INR 85.66 on the National Stock Exchange. The stock is down 7% since it announced its March quarter earnings on Apr. 26.

 

Of the four research reports on Bajaj Housing Finance available with Informist, three have a "buy" recommendation on the stock and one has a "hold" call. The average target price of the "buy" recommendation is INR 102, over 20% higher than the current market price. 

 

Following are the June quarter earnings estimates for Bajaj Housing Finance from six brokerages in descending order of the estimate of net profit in INR billion:

 

Brokerage	Net interest income	Net profit
PhillipCapital (India) Pvt. Ltd.	10.66	7.39
JM Financial Institutional Securities Pvt. Ltd.	9.80	6.96
Bank of America global research	9.92	6.89
Motilal Oswal Financial Services Ltd.	9.74	6.81
ICICI Securities Ltd.	9.62	6.74
Kotak Securities Ltd.	9.71	6.41
Average	9.91	6.86

 

End

 

Edited by Shubhayan Bhattacharya

 

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