Brokerage estimates suggest the non-banking finance major’s assets under management (AUM) expanded about 24% YoY and 4–5% QoQ to reach nearly Rs 4.6 lakh crore, led by strong traction across consumer, SME, and commercial lending.
Analysts believe that while growth momentum remains healthy, focus will now shift to commentary on margins, credit costs, and festive-season demand trends in the coming quarters.
NII and Margins: Stable trends expected
According to Kotak Equities, Bajaj Finance is likely to post NII growth of 23–24% YoY, supported by higher volumes and a moderate sequential uptick in spreads to 8.5% from 8.4% in Q1FY26, aided by a marginal reduction in borrowing costs.
Margins are expected to remain steady at around 9.5–9.6%, as per estimates by Motilal Oswal and JM Financial, while yields continue to benefit from portfolio repricing and a higher share of unsecured loans.
Emkay Global expects margins to improve sequentially, driven by easing funding costs amid an emerging soft interest rate environment. “Rate-cut benefits are beginning to reflect this quarter, supporting spreads,” the brokerage said in its preview note.
Asset quality and credit cost: No major surprises
Analysts expect credit costs to remain stable around 2% of AUM, broadly in line with recent quarters. Kotak projects a cost-to-average AUM ratio of 3.8%, improving 18 basis points year-on-year, reflecting operating leverage gains from scale and tighter expense control.Emkay forecasts gross and net stage 3 ratios to hold firm at 1% and 0.5%, respectively, highlighting strong collection efficiency and prudent underwriting. “Overall asset quality should remain robust with credit costs moderating marginally to below 2%,” it noted.
Profit outlook: 23% YoY rise expected
Consensus estimates peg Bajaj Finance’s net profit growth at 23% YoY, supported by healthy operating income and lower incremental credit provisioning. JM Financial said the company’s pre-provision operating profit (PPOP) is likely to see 7% sequential growth, reflecting steady performance across lending verticals.
Motilal Oswal expects overall profitability to improve in line with AUM growth, adding that commentary on the net interest margin (NIM) trajectory and credit cost trend will be key to gauging earnings sustainability for FY26.
Key factors to watch
Management outlook on festive-season demand and loan disbursement trends, updates on digital lending initiatives and customer acquisition, commentary on rate cycle impact on margins, portfolio mix shift between secured and unsecured assets and credit cost guidance for H2FY26.