Bajaj Finserv rises 2%; MOFSL initiates coverage, shares target price
Bajaj Finserv: MOFSL said Bajaj Finance provides the scale, profitability and 11 crore customer base and contributed 54 per cent of revenue for Bajaj Finserv in 9MFY26.
- Mar 25, 2026,
- Updated Mar 25, 2026 10:02 AM IST
Bajaj Finserv Ltd shares rose 2 per cent in Wednesday's trade amid a broader market rally. MOFSL has initiated coverage on the stock with a 'Neutral' rating and a target price of Rs 1,900, expecting profit after tax (PAT) from the established businesses including Bajaj Finance and Bajaj General Insurance and Value of New Business (VNB) of Bajaj Life to steadily grow at a FY26-28 CAGR of 28 per cent, 16 per cent and 19 per cent, respectively. It sees emerging businesses to gradually move toward breakeven, as they scale up.
On Wednesday, the stock rose 2.42 per cent to hit a high of Rs 1,745.90.
Saying Bajaj Finance's revenue and profit are expected to clock a CAGR of 15 per cent and 17 per cent, respectively, in FY26-28, with return on equity (RoE) in the range of 13-14 per cent, MOFSL suggested a target of Rs 1,900 for Bajaj Finserv, implying FY28 PE of 22 times.
MOFSL said Bajaj Finance provides the scale, profitability and 11 crore customer base and contributed 54 per cent of revenue for Bajaj Finserv in 9MFY26. Its AUM has grown at FY20-25 CAGR of 23 per cent and reached Rs 4.8 lakh crore at the end of 9MFY26.
"BAF remains the core value contributor, providing predictable earnings, strong ROE and sustained compounding," MOFSL said.
The general insurance subsidiary, Bajaj General, accounting for 24 per cent of 9MFY26 revenue, is India’s third largest general insurer with YTDFY26 market share of 7.1 per cent and one of the most profitable general insurers.
Bajaj General is the third largest private player in motor segment, the largest private multi-line insurer in health segment and the second largest private player in the fire segment.
"With its diversified exposure in retail and higher-margin commercial and group health segments, along with continued tech-led efficiency gains, the business is positioned to clock a GWP CAGR of 12 per cent during FY26-28 while sustaining the best-in-class combined ratios," MOFSL said.
The life insurance subsidiary, Bajaj Life, has transitioned from a ULIP-heavy, low-margin insurer to a more balanced franchise with FY20-25 APE CAGR of 28 per cent and VNB margin expansion from 9.9 per cent in FY20 to 16.4 per cent in 9MFY26.
"With continued product mix shift toward traditional, scale-up of protection business, and growth across channels, the next phase is expected to deliver VNB growth (19 per cent FY26-28 CAGR) ahead of APE growth (15 per cent FY26-28 CAGR) and steady EV compounding, strengthening its position among leading private life insurers," MOFSL said.
Bajaj Finserv Ltd shares rose 2 per cent in Wednesday's trade amid a broader market rally. MOFSL has initiated coverage on the stock with a 'Neutral' rating and a target price of Rs 1,900, expecting profit after tax (PAT) from the established businesses including Bajaj Finance and Bajaj General Insurance and Value of New Business (VNB) of Bajaj Life to steadily grow at a FY26-28 CAGR of 28 per cent, 16 per cent and 19 per cent, respectively. It sees emerging businesses to gradually move toward breakeven, as they scale up.
On Wednesday, the stock rose 2.42 per cent to hit a high of Rs 1,745.90.
Saying Bajaj Finance's revenue and profit are expected to clock a CAGR of 15 per cent and 17 per cent, respectively, in FY26-28, with return on equity (RoE) in the range of 13-14 per cent, MOFSL suggested a target of Rs 1,900 for Bajaj Finserv, implying FY28 PE of 22 times.
MOFSL said Bajaj Finance provides the scale, profitability and 11 crore customer base and contributed 54 per cent of revenue for Bajaj Finserv in 9MFY26. Its AUM has grown at FY20-25 CAGR of 23 per cent and reached Rs 4.8 lakh crore at the end of 9MFY26.
"BAF remains the core value contributor, providing predictable earnings, strong ROE and sustained compounding," MOFSL said.
The general insurance subsidiary, Bajaj General, accounting for 24 per cent of 9MFY26 revenue, is India’s third largest general insurer with YTDFY26 market share of 7.1 per cent and one of the most profitable general insurers.
Bajaj General is the third largest private player in motor segment, the largest private multi-line insurer in health segment and the second largest private player in the fire segment.
"With its diversified exposure in retail and higher-margin commercial and group health segments, along with continued tech-led efficiency gains, the business is positioned to clock a GWP CAGR of 12 per cent during FY26-28 while sustaining the best-in-class combined ratios," MOFSL said.
The life insurance subsidiary, Bajaj Life, has transitioned from a ULIP-heavy, low-margin insurer to a more balanced franchise with FY20-25 APE CAGR of 28 per cent and VNB margin expansion from 9.9 per cent in FY20 to 16.4 per cent in 9MFY26.
"With continued product mix shift toward traditional, scale-up of protection business, and growth across channels, the next phase is expected to deliver VNB growth (19 per cent FY26-28 CAGR) ahead of APE growth (15 per cent FY26-28 CAGR) and steady EV compounding, strengthening its position among leading private life insurers," MOFSL said.