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  1. Home
  2. Reports Bajaj Finance Ltd.:Q2FY26 Result Update
884.05 -2.75 (-0.31%)

Bajaj Finance Ltd.:Q2FY26 Result Update
11-11-2025

Advances Growth:

  • Advances grew by 24% YoY to Rs.4,62,261 crore from Rs.3,73,924 crore.

  • Growth was primarily driven by recently launched segments such as Gold Loans (+85% YoY), Open Market 2W & 3W Finance (+45% YoY), and Car Loans (+33% YoY).

  • Additionally, strong traction was seen in Commercial Lending (+27% YoY), Loan against Securities (+26% YoY), Mortgages (+25% YoY), and Urban B2C Loans (+25% YoY).

  • The company has curtailed MSME lending (~11% of AUM) due to emerging stress in the segment, as guided in the Q1FY26 conference call.

  • Consequently, management has slightly trimmed AUM growth guidance from ~23–24% to ~22–23%.

Net interest income: 

  • Net interest income (NII) grew by 22% YoY to Rs.12,853 crore from Rs.10,578 crore.

  • Interest income grew faster (+19% YoY) than interest expenses (+14% YoY).

Operating expenses:

  • Operating expenses increased 18% YoY to Rs.4,296 crore from Rs.3,639 crore, while the cost-to-income ratio improved by 60 bps to 32.6% from 33.2%.

  • The company’s FINAI programme (Finance + AI), which leverages artificial intelligence to reduce costs and enhance productivity, is expected to deliver tangible benefits in the next 12–18 months.

Provision and contingencies:

  • Provisions and contingencies rose 19% YoY to Rs.2,269 crore from Rs.1,909 crore, primarily due to higher provisioning in the MSME segment.

  • Elevated credit costs were also observed in the captive 2W and 3W portfolios, which are being gradually run down.

  • Excluding these two segments, credit costs across other portfolios remained stable.

Profitability:

  • PAT grew by 23% YoY to Rs.4,944 crore from Rs.4,010 crore.

  • RoA and RoE remained healthy and stable at 4.5% and 19.1%, respectively.

Cost of Fund:

  • The cost of funds declined by 45 bps YoY to 7.52% from 7.97%.

  • For FY26, management expects cost of funds to remain in the range of 7.55–7.60%.

  • The company is reducing reliance on deposits (which contributed ~18% of consolidated borrowings) to optimise overall funding costs.

Asset quality:

  • GNPA/NNPA increased marginally by 18/14 bps to 1.24%/0.60% from 1.06%/0.46%, mainly due to stress in the MSME segment and the run-down of the captive 2W & 3W portfolios.

  • Overall asset quality remains strong, supported by diversification and disciplined underwriting.

Other Update:

  • Structural reforms in income tax and GST by the Government lifted-up consumer sentiment and spurred consumption. These initiatives led to a strong festive season performance for consumption loans for the Company.

  • The Company has seen a strong momentum in consumption finance during the festive season (Navratri to Diwali), disbursing a record 6.3 MM consumer loans, recording a growth of 27% in volume and 29% in value as compared to the same period last year.

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884.05 -2.75 (-0.31%)
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