Bajaj Finance Limited has achieved a significant milestone in Q4 FY26, with its Assets Under Management (AUM) crossing the ₹5 lakh crore mark. The non-banking financial company reported strong growth across key business metrics in its regulatory filing under SEBI regulations.

Key Financial Milestones

The company's AUM reached approximately ₹510,000 crore as of March 31, 2026, representing a substantial 22% year-on-year growth from ₹416,661 crore in the previous year. During Q4 FY26 alone, the AUM increased by approximately ₹25,500 crore, demonstrating robust quarterly momentum.

Customer Franchise Expansion

Bajaj Finance's customer base witnessed significant expansion, with the customer franchise reaching 119.33 MM as of March 31, 2026, compared to 101.82 MM in the previous year. The company added 3.93 MM new customers during Q4 FY26, reflecting strong market penetration and customer acquisition capabilities.

Lending Performance

The company's lending business showed strong performance with new loans booked growing by 20.5% to 12.89 MM in Q4 FY26, compared to 10.70 MM in the corresponding quarter of the previous year. This growth indicates sustained demand for the company's financial products and services.

Deposits Portfolio

The deposits book stood at approximately ₹68,550 crore as of March 31, 2026, compared to ₹71,403 crore as of March 31, 2025. The company continues to maintain a substantial deposit base to support its lending operations.

Regulatory Compliance

The information was disclosed under Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulation, 2015, along with Schedule A of Regulation 8 of SEBI (Prohibition of Insider Trading) Regulations, 2015. The company noted that the disclosed figures are provisional and subject to review by statutory auditors.

HSBC has revised its outlook on Bajaj Finance while maintaining its Buy recommendation, significantly cutting the target price to Rs 920 from the previous Rs 1110. The substantial reduction reflects growing concerns over regional geopolitical developments and their potential impact on the financial services sector.

Target Price Revision and Rating Rationale

The brokerage's decision to maintain the Buy rating despite the sharp target price cut indicates confidence in the company's fundamental strength while acknowledging near-term headwinds. The new target price of Rs 920 represents a notable adjustment from the earlier Rs 1110, reflecting a more cautious stance on the stock's prospects.

Risk Factors and Earnings Concerns

HSBC has identified several key risk factors stemming from Middle East conflict-related developments that could impact earnings performance. The brokerage expects cuts across multiple financial metrics including AUM growth, margins, and EPS. These adjustments reflect the anticipated challenging operating environment for non-banking financial companies.

The analysis suggests that liability pressures are likely to emerge as the first visible impact, potentially affecting funding costs and liquidity management. Subsequently, asset quality risks may materialize, though the timeline and severity remain uncertain.

Sector Preferences and Defensive Positioning

Despite maintaining its positive stance on Bajaj Finance, HSBC has expressed preference for private banks and select NBFCs in the current market environment. The brokerage specifically favors Cholamandalam Investment and Finance and Shriram Finance among NBFC peers.

Additionally, HSBC views LIC Housing Finance as a defensive option, suggesting investors may benefit from exposure to housing finance companies that typically demonstrate more stable performance during uncertain periods.

Market Implications

The target price revision reflects broader concerns about the financial services sector's exposure to geopolitical risks and their potential transmission through various channels including funding costs, credit demand, and asset quality metrics. The maintained Buy rating suggests HSBC believes current market pricing may have adequately reflected these near-term challenges while the company's long-term prospects remain intact.