Nomura raises Bajaj Finance target to ₹1,270, flags 18% upside on AUM-growth outlook

Nomura retained its Buy call on Bajaj Finance, raising its target price to ₹1,270 as it expects FY27 AUM growth of 25%. The broker cited support from gold loans and MSME lending, while flagging RBI flexi-loan rules and stiff personal-loan competition as risks.

— Source published Fri, 21 Aug, 2026, 11:23 IST · First seen Fri, 21 Aug, 2026, 11:43 IST · Source Business Today · Latest

What happened

Nomura retained Buy on Bajaj Finance and lifted its target to Rs 1,270, citing prospective FY27 AUM growth. It flagged RBI flexi-loan rules and intense

Key facts

  • Target price: Rs 1,270
  • Implied upside: 18%
  • FY27 AUM growth estimate: 25% YoY
  • FY27 management AUM growth guidance: 22-24%
  • Projected FY27 closing-quarter AUM growth: 24-26% YoY
  • FY27-FY29 net-profit estimates raised: 3%
  • Credit-cost assumptions lowered: 4-11 basis points
  • Share price: Rs 1,093.70
  • Six-month share gain: 32%

Why this matters

The bullish outlook for gold loans and MSME lending highlights attractive partnership, distribution, and capability-acquisition opportunities in secured and small-business credit.

What to watch

  • Quarterly AUM growth trajectory versus the 25% FY27 expectation.
  • Gold-loan and MSME share of incremental disbursements and overall AUM.
  • RBI clarifications or enforcement related to flexi loans, unsecured lending and capital/provisioning requirements.
  • Personal-loan yields, customer acquisition costs and competitive pricing from banks, NBFCs and fintechs.
  • GNPA/NNPA, stage-3 formation, write-offs and credit-cost guidance, especially in unsecured portfolios.
  • Net interest margin, borrowing costs and return-on-assets/return-on-equity trends.
  • Increase sourcing and branch/digital distribution for gold loans and MSME credit while maintaining collateral and underwriting discipline.
  • Rebalance incremental disbursements away from vulnerable unsecured flexi-loan structures toward secured and granular products.
  • Use customer cross-sell, risk-based pricing and tighter collections to defend yields and credit quality amid personal-loan competition.
  • Provide investors with clearer disclosures on product-level AUM mix, regulatory exposure, delinquencies and credit-cost trends.