The largest NBFC stock, Bajaj Finance, will turn ex-date for its bonus issue of 4:1 and share sub-division in a 1:2 ratio next week. This will be the first bonus and split carried out by Bajaj Finance after a nine-year gap. Ahead of the record dates for the upcoming double rewards, Bajaj Finance shares have shown resilient performance on BSE and NSE, recording nearly 39% upside YTD. The recommendation in this large-cap is to buy with a target price seen above the Rs 10,200 mark.
Bajaj Finance Share Price:
After closing hours of June 9th, Bajaj Finance's share price ended at Rs 9608.30 apiece, up by 2.51% on BSE, with a market cap of Rs 5,97,088.59 crore. Notably, Bajaj Finance kickstarted this week with a banger as its share price touched a new 52-week high of Rs 9,785.90 apiece on Monday.
The stock's price-to-equity ratio is at 37.03x, and the return on equity (RoE) is at 20.35%. Bajaj Finance stock gained by over 6.5% in the past 5 trading sessions, while its month-on-month performance has surged by nearly 7%. YTD, Bajaj Finance stock is up by 38.5% on BSE.
Analysts recommended BUY on Bajaj Finance before the stock turned ex-date for the upcoming bonus and split.
Bajaj Finance Share Price Recommendation:
"With the mega rate cut of 50bps in the Jun'25 MPC meeting, we expect BAF's NIMs to move with a positive bias. Thus, BAF remains well-placed to navigate the rate cut cycle despite the pricing pressure in certain products and protect NIMs with scope to improve margins over the medium term," said analysts at Axis Securities in a note.
Further, these analysts predict that going ahead, Bajaj Finance's AUM growth will be driven across segments with strong contributions from the core businesses and a gradual ramp-up in the newer secured businesses. The gold and new car loans business continues to see strong traction, albeit on a lower base.
Moreover, their note added, "The concerns around the rural B2C business continue to fade, and the management remains optimistic that growth will bounce back in this portfolio from FY26 onwards. BAF remains well-poised to deliver AUM growth of ~25% CAGR over FY25-27E while prioritising asset quality."
On the valuation, the note said, "We expect BAF to deliver a strong AUM/NII/Earnings growth of 25/26/25% CAGR over the medium term, driven by (i) Steady-to-marginally improving NIMs, (ii) Operating leverage driving cost ratio improvement, and (iii) Positive outlook on asset quality, keeping credit costs under control. We expect BAF to deliver a RoA/RoE of 4.5-4.6%/19-21%, broadly in line with the management's long-term guidance. We recommend a BUY on the stock with a target price of Rs 10,225/share."
This signals a 6.42% potential upside in Bajaj Finance in the near term.
Bajaj Finance Bonus Issue:
Backed by Bajaj Finserv, this NBFC has declared a bonus issue in the ratio of 4:1, which means that, it will issue four new bonus shares at a face value of Re 1 each, for every 1 existing share for the face value of Re 1 each. The bonus issue will be implemented using free reserves which are currently at Rs 4,97,14,29,216.
The record date to determine the eligible shareholders for the bonus issue is fixed on Monday, 16 June 2025. This will be the first bonus issue in 9 years. The last time, Bajaj Finance turned ex-date for bonus issue was on September 8, 2016, for a 1:1 ratio.
Bajaj Finance Stock Split:
Additionally, the behemoth has announced to split its shares in the ratio of 1:2, which will mean the sub-division of 1 (one) equity share of the face value of Rs. 2 each fully paid up into 2 (two) equity shares of the face value of Re. 1 each fully paid-up. The record date is also fixed on June 16, 2025, for the same.
This will also be Bajaj Finance's second stock split. The first sub-division was on September 10, 2016, in the ratio of 1:5, where the face value of Rs 10 was trimmed to Rs 2.
About Bajaj Finance:
Bajaj Finance Ltd. ('BFL', 'Bajaj Finance', or 'the Company'), a subsidiary of Bajaj Finserv Ltd., is a deposit-taking Non-Banking Financial Company (NBFC-D) registered with the Reserve Bank of India (RBI) and is classified as an NBFC-Investment and Credit Company (NBFC-ICC). BFL is engaged in the business of lending and acceptance of deposits. It has a diversified lending portfolio across retail, SMEs, and commercial customers with a significant presence in both urban and rural India.
Disclaimer: The recommendations made above are by market analysts and are not advised by either the author or Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.
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