BAJAJHFL - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.5
| Stock Code | BAJAJHFL | Market Cap | 72,641 Cr. | Current Price | 87.2 ₹ | High / Low | 129 ₹ |
| Stock P/E | 28.3 | Book Value | 27.0 ₹ | Dividend Yield | 0.00 % | ROCE | 8.84 % |
| ROE | 12.1 % | Face Value | 10.0 ₹ | DMA 50 | 86.8 ₹ | DMA 200 | 98.9 ₹ |
| Chg in FII Hold | 0.05 % | Chg in DII Hold | -0.21 % | PAT Qtr | 669 Cr. | PAT Prev Qtr | 675 Cr. |
| RSI | 51.3 | MACD | 1.60 | Volume | 52,12,146 | Avg Vol 1Wk | 84,22,959 |
| Low price | 72.6 ₹ | High price | 129 ₹ | PEG Ratio | 1.05 | Debt to equity | 4.60 |
| 52w Index | 26.0 % | Qtr Profit Var | 14.1 % | EPS | 3.07 ₹ | Industry PE | 15.1 |
📊 Financials: BAJAJHFL shows moderate fundamentals with ROCE at 8.84% and ROE at 12.1%. EPS stands at ₹3.07, supported by quarterly PAT of ₹669 Cr. (stable vs ₹675 Cr. previous quarter). Debt-to-equity ratio is high at 4.60, reflecting significant leverage. Dividend yield remains 0.00%, limiting shareholder returns. Cash flows are steady but constrained by high debt servicing.
💹 Valuation: The stock trades at a P/E of 28.3 compared to the industry average of 15.1, indicating stretched valuations. The PEG ratio of 1.05 suggests growth is fairly priced but not cheap. Book value is ₹27, giving a P/B ratio of ~3.2, which is moderately expensive. Current price of ₹87.2 is near 50 DMA but below 200 DMA, showing neutral technical positioning.
🏢 Business Model & Competitive Advantage: BAJAJHFL operates in housing finance, benefiting from strong demand in the real estate sector. Its competitive advantage lies in scale and brand presence. However, high leverage and stretched valuations reduce its overall health and resilience.
🎯 Entry Zone: A favorable entry zone lies near ₹82–₹85 (close to support levels). Current price of ₹87.2 is slightly above comfort levels, suggesting cautious positioning for fresh entry.
📈 Long-Term Holding Guidance: Suitable for long-term investors only if earnings growth sustains and leverage reduces. Partial allocation with strict monitoring is recommended, with profit booking near ₹95–₹100 resistance.
Positive
- Moderate ROE (12.1%) and ROCE (8.84%)
- Quarterly PAT stable at ₹669 Cr.
- EPS at ₹3.07 provides earnings base
- FII holdings increased slightly (+0.05%)
Limitation
- High debt-to-equity ratio (4.60)
- Stretched P/E (28.3) vs industry average (15.1)
- Dividend yield at 0.00%
- Trading below 200 DMA (₹98.9)
Company Negative News
- DII holdings declined (-0.21%), showing reduced domestic support
- High leverage limits financial flexibility
Company Positive News
- Quarterly PAT remained stable despite sector challenges
- FII holdings increased slightly (+0.05%)
Industry
- Housing finance sector trades at industry P/E of 15.1
- Sector outlook remains positive with steady demand, but valuations are stretched
Conclusion
⚖️ BAJAJHFL is a moderately strong housing finance company with stable earnings and brand presence, but high leverage and stretched valuations limit attractiveness. Entry is advisable near ₹82–₹85. Long-term holding requires earnings growth and debt reduction; otherwise, cautious partial exposure with profit booking near ₹95–₹100 is recommended.