Bajaj Finance Reports 22% Profit Jump and ₹5.09 Lakh Crore AUM, But Asset Quality Shows Strain

Bajaj Finance announced a 22% year-on-year increase in consolidated net profit for the quarter ended March 31, 2026, reaching ₹5,464.57 crore. The company also crossed a significant milestone, with Assets Under Management (AUM) growing 22% to ₹5.09 lakh crore.

Conference Call Details

Bajaj Finance held a conference call on April 29, 2026, to discuss its financial results for the quarter and year ended March 31, 2026. A presentation from the call has been filed with the BSE and NSE, and an audio recording is available on the company's investor relations website for detailed insights into performance and outlook.

Investor Briefing Significance

These calls are vital for investors seeking direct commentary from management on financial performance, strategic plans, and future guidance. The readily available presentation and audio recording enhance transparency, helping investors make informed decisions.

Full Year Performance and Growth Drivers

Bajaj Finance has shown strong growth throughout FY26. Its Assets Under Management (AUM) exceeded ₹5 lakh crore, increasing by 22% to ₹5.09 lakh crore by March 31, 2026. The company also acquired new customers, booking 12.89 million loans in Q4 FY26, a 20% year-on-year rise, boosting its customer base by 17% to 119.33 million. For the full fiscal year FY26, net profit reached ₹19,017 crore, a 14.3% increase from the prior year.

Key Risks and Concerns

Asset quality has shown signs of strain, with Gross Non-Performing Loans (GNPL) increasing to 1.01% from 0.96% in the previous quarter. The company faces challenges with higher bad loans, especially in the MSME segment. The declared dividend of ₹6 per share for FY26 is the lowest since July 2019, possibly signaling a cautious capital allocation strategy or concerns about future earnings. Additionally, the departure of long-standing non-executive director Rajiv Bajaj from the board represents a significant leadership change, which may lead to investor focus on succession planning and corporate governance.

Valuation and Peer Analysis

Bajaj Finance's valuation, with a P/E ratio of approximately 31.5-32.3x, trades at a premium compared to major banks such as HDFC Bank (around 15.8x) and ICICI Bank (around 18.4x), and fellow NBFCs like Cholamandalam Investment (around 27x) and Shriram Finance (around 22x). While Bajaj Finance shows strong profit growth and AUM expansion, peers like HDFC Bank and ICICI Bank have recently maintained more stable or better asset quality metrics.

Key Financial Metrics

Consolidated Net Profit for Q4 FY26: ₹5,464.57 crore (a 22% year-on-year increase).
Assets Under Management (AUM) as of March 31, 2026: ₹5,09,975 crore (up 22% from the previous year).
Gross NPA ratio as of March 31, 2026: 1.01%.
Net NPA ratio as of March 31, 2026: 0.41%.

Looking Ahead

Investors will be monitoring analyst reports and commentary following the conference call for deeper insights. Key areas to watch include management's discussions on asset quality trends, especially within the MSME segment, and future capital allocation and dividend policies following the recent reduction. The impact of Rajiv Bajaj's departure on strategic direction and corporate governance will also be assessed, alongside updates on credit costs and loan loss provisions.