Bajaj Finance shares tumbled 5.3% to close at ₹8,613.5 while Bajaj Finserv dropped 5.6% to close at ₹1,951 on Wednesday. Benchmark Nifty Index ended nearly flat on Wednesday.
“Bajaj Finance’s results fell short on a couple of fronts – higher credit costs and decline in margins,” said Dnyanada Vaidya, research analyst – BFSI, Axis Securities. “Moreover, the management has revised its growth guidance a tad lower to 24-26% compared with its earlier guidance of 25-27%.”
So far this year, both Bajaj Finance and Bajaj Finserv’s shares surged 24.2% and 23.8%, respectively, while Nifty gained 2.5%.
“The stock has outperformed the index with a sharp run-up over the past six months, which has resulted in a catch-up on valuations,” said Vaidya. “However, the correction in the stock is primarily led by a setback on credit costs in FY25 and marginally slower growth guidance for FY26.”
Bajaj Finance’s decision to announce bonus shares and a special dividend of ₹56 per share failed to lift sentiment as investors chose to focus on the outlook.”Given the run up in the stocks in recent months, the lower growth guidance led to a decline in the shares,” Hemang Jani, director, Finazenn – an investment advisory. “The stocks are trading at expensive valuations, and it is difficult to justify the 4.5 to 5 times price to book ratio for Bajaj Finance, despite the growth guidance of 25% for next year.”
AgenciesVaidya said, despite the cut in guidance on key parameters, the long-term investment thesis for Bajaj Finance remains intact
“We believe near-term pressure on the stock could be visible with no major re-rating levers visible; however, this is a good time to accumulate the stock on dips,” said Vaidya.
