Bajaj Finance shares fell sharply by 6% on July 25 after the company announced its results for the June quarter. While the profits looked strong on paper, the market did not react well. Here’s a breakdown of what happened and what it could mean for you as an investor.
Strong profits, but deeper worries
Bajaj Finance, one of India’s top NBFCs, reported a 22% rise in consolidated net profit. The profit jumped to ₹4,765 crore in Q1FY26 from ₹3,912 crore last year. Revenue also went up by 21% to ₹19,524 crore. So why did the stock crash?
The problem lies beneath the surface. The company is seeing rising stress in MSME and two-wheeler/three-wheeler loan segments. Credit costs are going up, and that is worrying investors and analysts alike.
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Brokerages turn cautious
Big names like JPMorgan, UBS, and Macquarie are not feeling too optimistic. JPMorgan has downgraded Bajaj Finance to ‘neutral’ from ‘overweight’. UBS gave a ‘sell’ call with a target price of ₹750. Macquarie also marked it as ‘underperform’ and said the current stock price is too high for the expected future growth.
Bernstein is even more bearish. They gave it a target of ₹640 and said credit costs are higher than what the company guided earlier. They also raised questions about future leadership, with the next CEO expected only by 2028.
Some are still bullish. Motilal Oswal kept its ‘buy’ rating with a target of ₹2,140. They believe the company is still strong and can recover once macroeconomic conditions improve.
Should you worry?
If you already hold Bajaj Finance shares, don’t panic. Yes, there is short-term stress, especially in the MSME loan segment. But the company’s overall performance is still solid. Long-term investors may want to hold and wait for clarity in the next quarter.
If you’re thinking of buying now, tread carefully. Wait and watch how things develop. The share may get cheaper in the coming weeks if stress continues. If you’re a short-term trader, this may not be the best time.
Bajaj Finance is facing short-term pain, but it’s still a major player. The market is reacting to rising credit stress and doubts about near-term growth. If you trust the brand and are in it for the long game, holding makes sense. But don’t ignore the warning signs either.
Disclaimer:
This article is for informational purposes only and is not financial advice. Please consult a certified advisor before making investment decisions.
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