Bajaj Housing Finance: Key Risks and Opportunities After Q2 Results
Bajaj Housing Finance shares will be in focus after the company reported its Q2 results, with Motilal Oswal highlighting three key risks and maintaining a 'Neutral' rating on the stock.
Bajaj Housing FinanceQ2 ResultsMotilal OswalStock PerformanceFinancial RisksReal Estate NewsNov 07, 2025
Asset quality remained stable during the quarter, with gross non-performing assets (NPA) at 0.26%, down from 0.29% in the June quarter. The net NPA remained unchanged at 0.12%.
Brokerage firm Motilal Oswal maintained a 'Neutral' rating on Bajaj Housing Finance, setting a target price of ₹120, which implies a potential upside of 10% from current levels. The firm noted that Bajaj Housing delivered a strong performance in Q2, with robust assets under management (AUM) and disbursement growth across products, despite heightened competition.
The company managed to maintain its margins in a declining interest rate environment while preserving strong asset quality. According to Motilal Oswal, Bajaj Housing Finance remains a strong franchise, well-positioned to navigate rising competition and a softer rate cycle while sustaining healthy growth and profitability.
However, Motilal Oswal also highlighted key risks that investors should be aware of. These include a potential slowdown in overall growth and demand, limited ability to expand net interest margins (NIM) due to competitive pricing, and possible asset-quality pressure if the company scales up its non-prime segments.
Motilal Oswal expects Bajaj Housing Finance's loans and profit to grow at a compound annual growth rate (CAGR) of 22% over FY25-28, with return on assets (RoA) and return on equity (RoE) estimated to reach 2.3% and 14.2%, respectively, by FY28.
Bajaj Housing Finance was one of the most successful listings of last year, debuting at a premium of more than 100% to its IPO price of ₹70. However, after hitting a post-listing high of over ₹180, the stock has since corrected nearly 40% and is now trading close to the ₹100 mark.
On Thursday, shares ended 0.3% lower at ₹109.25 ahead of the results announcement. The stock has declined by 15% so far this year.
Frequently Asked Questions
What were the key highlights of Bajaj Housing Finance's Q2 results?
Bajaj Housing Finance reported a net profit of ₹643 crore, marking an 18% year-on-year increase, and revenue grew by 17% to ₹2,614 crore. Asset quality remained stable with gross NPAs at 0.26% and net NPAs at 0.12%.
What is Motilal Oswal's rating and target price for Bajaj Housing Finance?
Motilal Oswal has maintained a 'Neutral' rating on Bajaj Housing Finance with a target price of ₹120, implying a potential upside of 10% from current levels.
What are the key risks highlighted by Motilal Oswal for Bajaj Housing Finance?
The key risks include a potential slowdown in overall growth and demand, limited ability to expand net interest margins (NIM) due to competitive pricing, and possible asset-quality pressure if the company scales up its non-prime segments.
What is the expected growth for Bajaj Housing Finance over the next few years?
Motilal Oswal expects Bajaj Housing Finance's loans and profit to grow at a compound annual growth rate (CAGR) of 22% over FY25-28, with RoA and RoE estimated to reach 2.3% and 14.2%, respectively, by FY28.
How has the stock performed since its IPO?
Bajaj Housing Finance was one of the most successful listings of last year, debuting at a premium of more than 100% to its IPO price of ₹70. However, after hitting a post-listing high of over ₹180, the stock has since corrected nearly 40% and is now trading close to the ₹100 mark.
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