Bajaj Housing Finance reported a 23% year-on-year growth in net profit to ₹720 crore for the first quarter of fiscal year 2027. While performance exceeded some estimates, brokerages remain cautious due to current stock valuations. Investors are focused on how the company manages sustained growth alongside rising operating expenses.
Bajaj Housing Finance has reported its financial results for the first quarter of the 2027 fiscal year, showing a 23% increase in profit after tax compared to the same period last year. The profit figure reached approximately ₹720 crore, which stood about 5% higher than analyst estimates.
The company’s net interest income, which is the core difference between interest earned on loans and interest paid on deposits, grew by 9% year-on-year to reach approximately ₹970 crore. Additionally, the company saw a significant 64% increase in other income, contributing ₹210 crore to the total. This helped the net total income grow by roughly 16% year-on-year to ₹1,170 crore for the quarter.
Operational Costs and Profitability
Operating expenses for the period rose by 7% year-on-year to reach ₹230 crore, a figure that remained in line with market forecasts. With income growing at a faster pace than these operating costs, the company's profit before provisions and contingencies expanded by 18% year-on-year to reach ₹940 crore. These provisions are funds set aside by the company to cover potential future losses on loans, and their management is a key factor in the final reported profit.
Valuation and Market Perspective
Following these results, the brokerage firm Motilal Oswal has maintained a neutral stance on the stock. The brokerage noted that the current market price, which trades at 2.9 times the estimated book value per share for the 2027 fiscal year, appears to have already accounted for the company's expected growth and profitability in the medium term. The brokerage has set a price target of ₹95, based on a multiple of 2.7 times the estimated book value for fiscal year 2028.
For investors, the key monitorable remains the company’s ability to maintain its profit margins while competing in the housing finance sector. The housing finance market in India is highly competitive, and companies often face pressure from both established banks and other non-banking financial companies. Maintaining a balance between loan growth and asset quality will be important, especially as the company continues to spend on expansion and operational infrastructure. Investors may track future quarterly updates to see if the growth in other income remains consistent or if core interest income trends show more significant momentum.