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Informist, Friday, Jul. 31, 2026

 

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--Bajaj Finserv: Insurance ops well poised to weather external shocks 
--CONTEXT: Comments from Bajaj Finserv mgmt in post earnings analyst call 
--Bajaj Finserv: Bajaj Finserv Direct to break even in Q3 or Q4 FY27 
--Bajaj Finserv: Bajaj Finserv Health to break even in Q3 or Q4 FY28 
--Bajaj Finserv: Health arm may need INR 2 bln INR 3 bln of capital infusion 
--Bajaj Finserv: Expect to improve Bajaj Life margins further 
 

 

By Kabir Sharma and Eshitva Prakash

 

MUMBAI – Bajaj Finserv Ltd. expects its digital marketplace subsidiary, Bajaj Finserv Direct, to break even in the third or fourth quarter of the current financial year, while its healthcare platform, Bajaj Finserv Health, is likely to reach the milestone in the second half of 2027-28 (Apr-Mar), the company's management said at a post-earnings analyst call. 

 

Bajaj Finserv Direct's revised profitability timeline remains intact, though it is delayed from its earlier target. Management attributed the postponement to investments in revamping its customer relationship management platform, compliance with digital lending guidelines, and changes to partner revenue structures, including a shift toward trail-based commissions. These changes weighed on revenue in the near term but are expected to provide a stronger and more predictable business model over the long term. The company reiterated that Bajaj Finserv Direct should turn profitable on a quarterly basis by the second half of FY27 and report full-year profitability in FY28. 

 

The management added that Bajaj Finserv Health is expected to break even in the third or fourth quarter of FY28, with full-year profitability likely in the following financial year. It said the healthcare platform continues to invest in technology and expand its provider network, which now includes more than 130,000 doctors, over 15,000 hospitals and more than 7,000 laboratory touchpoints. These investments are expected to start yielding returns from next year onward. 

 

Bajaj Finserv said the health business may require an additional capital infusion of around INR 2 billion to INR 3 billion over the next six quarters. However, it clarified that Bajaj Finserv Direct is not expected to require any further capital. Apart from the health business, future capital allocation will primarily be directed towards the asset management business, the alternate investment platform and the proposed reinsurance venture. 

 

On its insurance businesses, the management said both Bajaj General Insurance and Bajaj Life Insurance remain financially strong and are well positioned to withstand external macroeconomic shocks, supported by healthy solvency ratios of 254% and 285%, respectively. It said the insurers' financial strength leaves them well placed to weather external adversity despite the challenging operating environment. 

 

Commenting on Bajaj Life Insurance, the management said it expects to improve new business margins over time through a combination of a richer product mix, a greater share of protection products and continued cost optimisation under its "Bajaj Life 2.0" strategy. It said the company would continue increasing the share of higher-margin products, particularly non-participating products where feasible, while maintaining momentum in retail protection sales.

 

Management also highlighted that the insurer has undertaken cost rationalisation over the past 21 months, which has strengthened operating leverage and supported margin expansion despite regulatory changes, including the impact of the goods and services tax. 

 

During the quarter, Bajaj Finserv, along with its promoter group entities Bajaj Holdings and Investment Ltd. and Jamnalal Sons Pvt. Ltd., completed the acquisition of a 23% stake held by Allianz SE in the two insurance subsidiaries, Bajaj General Insurance and Bajaj Life Insurance. Bajaj Finserv reported a net profit of INR 31.32 billion for the June quarter, up over 12% on year and over 23% from the quarter ago.

 

The company's shares rose after the announcement of results and closed at INR 2,029.10 on the National Stock Exchange, up 6.3% from the previous close.  End

 

Edited by Saji George Titus

 

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