Bajaj Finance reported a 29% jump in quarterly profit to ₹6,370 crore, with assets under management reaching ₹5.85 trillion. While the lender raised its growth guidance, it faces margin pressure from regulatory shifts by the RBI and insurance commission caps. Investors are tracking how digital initiatives and portfolio adjustments will protect profitability.
Bajaj Finance reported a profit after tax of ₹6,370 crore for the second quarter of the 2027 fiscal year, marking a 29% increase compared to the same period last year. This performance was supported by a 24% rise in net interest income and strong demand across its loan segments. The company has reached assets under management of ₹5.85 trillion and has expressed confidence in future demand by raising its full-year growth guidance for assets under management to 26-27%.
Despite the growth in assets, the business continues to face significant pressure from the regulatory environment. Proposed restrictions by the Reserve Bank of India on revolving credit could compress net interest margins if fully implemented. Furthermore, potential changes to insurance commission norms by the Insurance Regulatory and Development Authority of India threaten to impact the company’s fee-based income. To navigate these challenges, management has started pruning its vehicle loan portfolio and refining its gold loan strategies to better manage credit risks and protect profit margins in a tighter interest rate environment.
To counter the impact of these regulatory mandates, the company is accelerating its use of technology. Its dedicated internal team, FinAI, is now utilizing AI-driven bots to handle 75% of customer service interactions, which has helped drive a 111% year-on-year increase in digital loan disbursements. The firm is also testing a new risk model across its business-to-business accounts, aiming to improve credit quality by up to 20%. This strategy is designed to drive operational efficiency and offset margin erosion caused by external factors.
The main monitorable for investors will be how the lender balances aggressive asset growth with the need to protect margins amid regulatory changes. The company has set a return on equity target of 19-21% for the 2028 fiscal year, and shareholders will be watching closely to see if these digital and operational adjustments effectively maintain profitability in upcoming quarters.