BAJFINANCE - Fundamental Analysis: Financial Health & Valuation

📈 Positive

• ROE of 18.5% and ROCE of 11.5% — reflects efficient capital deployment and profitability.
• EPS of ₹28.0 — supports valuation and earnings consistency.
• Quarterly PAT growth of 21.5% — signals strong operational performance.
• MACD positive at 23.6 and RSI at 55.5 — neutral to bullish technical indicators.
• FII holding increased by 0.26% — indicates foreign investor confidence.
• Dividend yield of 0.42% — modest but consistent shareholder returns.

⚠️ Limitation

• P/E ratio of 42.1 vs industry average of 22.6 — suggests premium valuation.
• PEG ratio of 1.30 — earnings growth slightly trails valuation.
• Book Value of ₹142 vs current price of ₹1,043 — high P/B ratio.
• Debt-to-equity ratio of 3.13 — high leverage typical of NBFCs, but adds financial risk.
• DII holding declined by 0.13% — signals mild domestic caution.
• Volume below average — may reflect short-term cooling in market interest.

📉 Company Negative News

• Stock corrected ~5.4% from its 52-week high of ₹1,102.
• Concerns around rising interest rates and regulatory tightening in NBFC space.

📢 Company Positive News

• Q2 PAT rose to ₹4,133 Cr from ₹3,940 Cr — consistent earnings growth.
• Stock up 86.9% over the past year — strong investor returns.
• Continued expansion in digital lending and consumer finance segments.

🏭 Industry

• NBFC sector remains crucial for credit delivery in underserved segments.
• Industry P/E of 22.6 — Bajaj Finance trades at a significant premium.
• Digital transformation and fintech integration are reshaping the competitive landscape.

🧾 Conclusion

• Business Model: Leading NBFC with diversified lending portfolio and strong digital infrastructure.
• Competitive Advantage: Brand strength, tech-driven scalability, and consistent earnings growth.
• Entry Zone: ₹980–₹1,020 — near DMA 50 and technical support.
• Long-Term Holding: Suitable for investors seeking growth exposure in financial services with a 3–5 year horizon.