Company Introduction
Headquarters Location: Pune, India
Core Business Summary: Bajaj Finance is a leading Indian non-banking financial company (NBFC) that provides a range of financial services, including consumer lending, small business loans, and wealth management.
Overview
₹ 1,018
36.29
28
₹ 63,226 Cr
Company Overview
Core Products & Services: Consumer lending, small business loans, wealth management, and insurance
Industry Sector: Financial Services
Industry Trends
Industry Growth Next 5 Years: The Indian NBFC sector is expected to grow at a CAGR of 15-20% over the next 5 years, driven by increasing demand for credit and financial inclusion.
Key Demand Drivers: Growing middle class, urbanization, and digitalization
Last 5 Year Cagr Industry Growth: The Indian NBFC sector has grown at a CAGR of 18.5% over the last 5 years.
Major Competitors: HDFC Bank, ICICI Bank, Bajaj Finserv, and Axis Bank
Financials
| 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | |
|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | 7,299 | 9,970 | 12,746 | 18,487 | 26,374 | 26,673 | 31,641 | 41,411 | 54,974 | 69,709 |
| YoY % | +36.6% | +27.8% | +45.0% | +42.7% | +1.1% | +18.6% | +30.9% | +32.8% | +26.8% | |
| EBITDA | 56 | 71 | 102 | 144 | 295 | 325 | 385 | 485 | 683 | 881 |
| YoY % | +26.8% | +43.7% | +41.2% | +104.9% | +10.2% | +18.5% | +26.0% | +40.8% | +29.0% | |
| Net Profit | 1,279 | 1,836 | 2,496 | 3,995 | 5,264 | 4,420 | 7,028 | 11,508 | 14,451 | 16,779 |
| YoY % | +43.5% | +35.9% | +60.1% | +31.8% | -16.0% | +59.0% | +63.7% | +25.6% | +16.1% | |
| EPS | 2.37 | 3.34 | 4.32 | 6.91 | 8.75 | 7.33 | 11.61 | 19.01 | 23.35 | 26.77 |
| YoY % | +40.9% | +29.3% | +60.0% | +26.6% | -16.2% | +58.4% | +63.7% | +22.8% | +14.6% |
Growth Drivers
Historical Growth Drivers: Bajaj Finance's growth has been driven by its strong distribution network, product innovation, and technology adoption, with a 25% CAGR in net interest income over the last 5 years.
Future Growth Drivers: The company is expected to continue growing through its expansion into new markets, strategic partnerships, and increased adoption of digital channels, with a target of 20% CAGR in net interest income over the next 3-5 years.
Market Position
Competitive Position: Bajaj Finance is one of the largest NBFCs in India, with a strong brand and extensive distribution network.
Estimated Market Share: Bajaj Finance has a market share of around 12% in the Indian NBFC sector.
Technological Moat: The company has invested heavily in digitalization, with over 80% of its customer interactions now happening through digital channels.
Strengths
- Bajaj Finance has a large and extensive distribution network, with over 1,400 branches and 100,000+ distribution points across India.
- The company has a strong track record of product innovation, with a range of new products and services launched in recent years, including digital lending and payment products.
- Bajaj Finance has a strong balance sheet, with a net interest margin of 12.1% and a return on equity of 22.1% in FY22.
- The company has an experienced management team, with a deep understanding of the Indian financial services sector.
Weaknesses
- Bajaj Finance is subject to regulatory risks, with changes in regulations and policies potentially impacting its business and profitability.
- The Indian NBFC sector is highly competitive, with many established players and new entrants competing for market share.
- Bajaj Finance is exposed to cyclical risks, with economic downturns potentially impacting its business and profitability.
- The company is exposed to asset quality risks, with potential defaults and non-performing assets impacting its profitability and balance sheet.
Valuations
Valuations for BAJFINANCE
| Formula | Bull | Base | Bear | Margin of Safety |
|---|---|---|---|---|
| Ben Graham | ₹ 503 | ₹ 503 | ₹ 185 | -102.6% |
| Peter Lynch | – | ₹ 268 | – | -280.4% |
Rule of thumb (Lynch):
PEG ≈ 1 → Fairly valued
PEG < 1 → Undervalued (growth cheap relative to earnings)
PEG > 1.5 → Overvalued
Outlook
Balanced Forward Looking Analysis: Bajaj Finance is well-positioned for growth over the next 3-5 years, driven by its strong distribution network, product innovation, and technology adoption. However, the company is subject to regulatory risks, competition, and cyclical risks, which could impact its business and profitability.
Opportunities: The company has opportunities to expand into new markets, increase its digital presence, and launch new products and services.
Risks: The company is exposed to regulatory risks, competition, and cyclical risks, which could impact its business and profitability.
Stock Price Performance
| 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | |
|---|---|---|---|---|---|---|---|---|---|---|
| Price | 68.78 | 118.18 | 181.86 | 300.15 | 221.94 | 527.22 | 740.81 | 571.51 | 725.10 | 869.82 |
| YoY % | +71.8% | +53.9% | +65.0% | -26.1% | +137.6% | +40.5% | -22.9% | +26.9% | +20.0% |
Stock 3 Year Rolling CAGR
| Metric | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | Average |
|---|---|---|---|---|---|---|---|---|---|
| Revenue | 20.42% | 22.85% | 27.43% | 13.00% | 6.26% | 15.79% | 20.22% | 18.96% | 18.12% |
| EBITDA | 22.12% | 26.58% | 42.48% | 31.17% | 9.28% | 14.28% | 21.06% | 22.01% | 23.62% |
| Net Profit | 24.97% | 29.58% | 28.24% | 3.43% | 10.11% | 37.57% | 27.16% | 13.39% | 21.81% |
| EPS | 22.16% | 27.42% | 26.52% | 1.99% | 9.89% | 37.39% | 26.23% | 12.09% | 20.46% |
| Price | 38.28% | 36.44% | 6.86% | 20.66% | 49.45% | 2.73% | -0.71% | 15.03% | 21.09% |
