Bajaj Finance Share Price Surges After Reporting 27% Jump in Festive Loan Growth

Bajaj Finance Ltd. share price rose to near day’s high after the company said that it has recorded a 27% surge in festive loan volume. This significant increase in loan growth can be attributed to the company’s efforts to increase financial inclusion and provide consumer loans to a wider audience.

Festive Loan Volume Sees 27% Surge

During the festive season, Bajaj Finance has disbursed a record number of consumer loans, which is higher by 27% in volume, and 29% in value as compared to the corresponding period of the previous year, the exchange filing said. This surge in loan growth is a positive indicator for the company, as it suggests that more people are turning to Bajaj Finance for their financial needs.

Bajaj Finance disbursed approximately 63 lakh loans from Sept 22 to Oct 26, which is a significant increase from the previous year. This increase in loan disbursement can be attributed to the company’s efforts to increase its reach and provide financial services to a wider audience.

First-Time Borrowers Drive Growth

First-time borrowers are now 52% of the new-to-Bajaj Finance customers’ pie, which indicated that financial inclusion has also increased, the non-banking financial company said in an exchange filing. This is a positive trend, as it suggests that more people are gaining access to financial services and are able to borrow money to meet their financial needs.

During the same period, Bajaj Finance added 23 lakh new customers, of which 52% were new-to-credit, thus significantly advancing financial inclusion. This increase in new customers and first-time borrowers is a positive indicator for the company, as it suggests that more people are turning to Bajaj Finance for their financial needs.

Government Policies Support Loan Growth

The government’s step to reduce GST rates and personal income tax helped to increase loans for consumer goods. Lower GST rate for television and air conditioners has helped consumers reduce their average ticket size of loans by 6% while they upgraded to higher-end products, Bajaj Finance said in the exchange filing.

This reduction in GST rates and personal income tax has made it easier for consumers to purchase consumer goods, which has in turn driven loan growth for Bajaj Finance. The company’s ability to provide consumer loans at competitive interest rates has also helped to drive growth.

Bajaj Finance Share Price Rises

Bajaj Finance share price rose 1.66% to Rs 1,060 apiece. It was trading 1.29% higher at Rs 1,056 apiece as of 1:29 p.m. compared to 0.36% decline in the NSE Nifty 50 index.

The stock rose 54.43% in 12 months, and 55.1% on year to date basis. Total traded volume on National Stock Exchange so far in the day stood at 2.39 times its 30-day average. The relative strength index was at 56.60.

Analyst Ratings and Price Target

Out of 37 analysts tracking the company, 20 maintain a ‘buy’ rating, 12 recommend a ‘hold’ and five suggest ‘sell’, according to Bloomberg data. The average 12-month consensus price target implies an upside of 22.7%.

This suggests that analysts are bullish on the company’s prospects, and expect the stock to continue to rise in the coming months. The company’s strong financial performance and increasing loan growth are likely to drive the stock price higher.

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