Bajaj Finance shares can rise another 29%, here's why

Bajaj Finance is set to expand its net interest margin (NIM) by 10 basis points over the year, a move anticipated to strengthen its financial footing. The company is moderating growth in its SME financing sector to address potential asset quality concerns, as noted by brokerage firm CLSA. Bajaj Finance's stock surged 1.1%, reaching an intraday high of ₹899.55 per share on Tuesday. The rally contributes to a 29.05% gain for the year so far.

AI-driven initiatives remain a focal point for Bajaj Finance, with plans to deploy 100 use cases by the financial year 2026. These efforts are expected to enhance operational efficiency and bolster cross-selling revenue, thereby lowering the cost-to-income ratio, according to CLSA. The effects of the recent RBI monetary policy committee's repo rate reductions are already becoming evident, the brokerage added. Bajaj Finance's focus on AI initiatives underlines its commitment to future growth and efficiency.

According to CLSA, Bajaj Finance's shares have the potential to rise by another 29%, sustaining the growth trajectory witnessed in 2025. The brokerage affirmed its "outperform" rating with a target price of Rs 1,150 per share. The stock previously closed at ₹889.35 each. Bajaj Finance is gearing up to achieve loan growth in the mid-20s percentage range for FY2026 and beyond, despite acknowledging a slowdown in banking credit. The company also recognises the indirect impact of Trump's tariffs on export sectors, potentially affecting consumers.