Breakout from the channel, targets of around 11,000 by year end
Bajaj Finance Stock Analysis – 2024
1. Strong Track Record of Consistent Growth
Bajaj Finance has been one of the most consistent compounders in the Indian stock market. Over the past decade, it has delivered CAGR returns of 25-30%, outperforming most large-cap peers. However, in the last 2-3 years, the stock price has remained largely range-bound due to rising interest rates, regulatory concerns, and macroeconomic uncertainty.
2. Recent Breakout and All-Time High
Despite this consolidation phase, Bajaj Finance has recently achieved a new all-time high, signaling renewed momentum. This breakout suggests that investors are regaining confidence in the company's future growth prospects.
3. RBI’s Liquidity Boost – A Key Growth Driver
With the RBI infusing more liquidity into the system, the cost of funds for NBFCs (Non-Banking Financial Companies) like Bajaj Finance is expected to decline. This will allow the company to:
Expand its loan book at an accelerated pace
Improve net interest margins (NIMs)
Strengthen its competitive position in consumer and SME lending
4. Fundamental Strengths
Loan Book Growth: Maintains a 25-30% YoY loan book growth with a well-diversified portfolio across consumer, SME, and rural lending.
Strong Asset Quality: Despite macroeconomic headwinds, GNPA remains under 1.5%, reflecting disciplined risk management.
Profitability: Consistently delivers ROE of 20%+ and ROA above 4%, among the best in the industry.
5. Technical View – Bullish Momentum
The stock has broken out of a multi-year consolidation phase, with increasing volumes supporting the uptrend.
If sustained above key resistance levels, further upside can be expected toward ₹9000-9500 in the medium term.
RSI and MACD indicators suggest strong bullish momentum.
6. Key Risks to Watch
Regulatory Changes: RBI’s tightening of NBFC norms could impact lending flexibility.
Macroeconomic Factors: A slowdown in consumption or higher interest rates could affect demand for loans.
Competitive Pressure: Increasing competition from banks and fintech companies.
Conclusion
Bajaj Finance is well-positioned to benefit from RBI’s liquidity push, strong demand for consumer finance, and improving asset quality. With a fresh all-time high, the stock could continue its upward trajectory, making it an attractive bet for long-term investors
1. Strong Track Record of Consistent Growth
Bajaj Finance has been one of the most consistent compounders in the Indian stock market. Over the past decade, it has delivered CAGR returns of 25-30%, outperforming most large-cap peers. However, in the last 2-3 years, the stock price has remained largely range-bound due to rising interest rates, regulatory concerns, and macroeconomic uncertainty.
2. Recent Breakout and All-Time High
Despite this consolidation phase, Bajaj Finance has recently achieved a new all-time high, signaling renewed momentum. This breakout suggests that investors are regaining confidence in the company's future growth prospects.
3. RBI’s Liquidity Boost – A Key Growth Driver
With the RBI infusing more liquidity into the system, the cost of funds for NBFCs (Non-Banking Financial Companies) like Bajaj Finance is expected to decline. This will allow the company to:
Expand its loan book at an accelerated pace
Improve net interest margins (NIMs)
Strengthen its competitive position in consumer and SME lending
4. Fundamental Strengths
Loan Book Growth: Maintains a 25-30% YoY loan book growth with a well-diversified portfolio across consumer, SME, and rural lending.
Strong Asset Quality: Despite macroeconomic headwinds, GNPA remains under 1.5%, reflecting disciplined risk management.
Profitability: Consistently delivers ROE of 20%+ and ROA above 4%, among the best in the industry.
5. Technical View – Bullish Momentum
The stock has broken out of a multi-year consolidation phase, with increasing volumes supporting the uptrend.
If sustained above key resistance levels, further upside can be expected toward ₹9000-9500 in the medium term.
RSI and MACD indicators suggest strong bullish momentum.
6. Key Risks to Watch
Regulatory Changes: RBI’s tightening of NBFC norms could impact lending flexibility.
Macroeconomic Factors: A slowdown in consumption or higher interest rates could affect demand for loans.
Competitive Pressure: Increasing competition from banks and fintech companies.
Conclusion
Bajaj Finance is well-positioned to benefit from RBI’s liquidity push, strong demand for consumer finance, and improving asset quality. With a fresh all-time high, the stock could continue its upward trajectory, making it an attractive bet for long-term investors
Penafian
Maklumat dan penerbitan adalah tidak dimaksudkan untuk menjadi, dan tidak membentuk, nasihat untuk kewangan, pelaburan, perdagangan dan jenis-jenis lain atau cadangan yang dibekalkan atau disahkan oleh TradingView. Baca dengan lebih lanjut di Terma Penggunaan.
Penafian
Maklumat dan penerbitan adalah tidak dimaksudkan untuk menjadi, dan tidak membentuk, nasihat untuk kewangan, pelaburan, perdagangan dan jenis-jenis lain atau cadangan yang dibekalkan atau disahkan oleh TradingView. Baca dengan lebih lanjut di Terma Penggunaan.