On May 3rd, Bajaj Finance witnessed a remarkable surge of 7.5%, reaching Rs 7,400 per share, following the Reserve Bank of India’s (RBI) decision to lift curbs on its two digital lending products, ‘eCOM’ and online ‘Insta EMI Card’, effective immediately. Brokerages maintained a bullish stance on the NBFC giant, foreseeing a positive trajectory for investor confidence.
Jefferies analysts upheld their ‘buy’ rating on Bajaj Finance, setting a target price of Rs 9,260 per share, indicating a potential upside of 34%. They highlighted the removal of RBI’s ban as a catalyst for the company’s business, projecting a robust profit growth of 24% CAGR over FY24-27.
Citi also retained its ‘buy’ rating, assigning a target price of Rs 8,675 per share, praising Bajaj Finance’s swift rectification of deficiencies within just five months and foreseeing enhanced visibility towards the upper end of guidance.
Previously, on November 15, 2023, the RBI had directed Bajaj Finance to halt the sanction and disbursal of loans under its ‘eCOM’ and ‘Insta EMI Card’ due to non-compliance with digital lending guidelines, significantly impacting the company’s profitability and new loan book.
Emkay analysts anticipated a surge in customer acquisition and fee income following the lifting of the ban, fostering a positive outlook for Bajaj Finance in FY25. They maintained their ‘buy’ rating with an unchanged target price of Rs 9,000 per share, emphasizing confidence in the company’s future outlook.
Despite a decline of over 6% in the stock’s performance year-to-date, surpassing the 4% rise in the Nifty 50 index, analysts remain optimistic about Bajaj Finance’s potential for growth and recovery.
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