Housing Finance Company Archives

BAJAJHFL – Bajaj Housing Finance – Q4 FY26 Earnings Call – 27-Apr-26

BAJAJHFL: Topline growth remains robust (20%+ AUM), but bottomline pressure from NIM compression (~10 bps ROA impact) and margins face structural headwinds (yield mix, competitive intensity) offset partially by opex/credit cost tailwinds.

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Also see: BAJAJHFL – Bajaj Housing Finance – Q4 FY26 Financial Results – 27-Apr-26

3-Scenario Framework

📊 Base Case (60% Probability)

Key Variables: Stable policy rates, money market rates normalize by H2 FY27, competitive intensity moderates.
Outlook: NIM compression ~10 bps (offset by opex efficiency and lower credit costs). AUM grows 20–22%, ROA at 2.2%, ROE at 12.5%. BT-out rates decline to 8–9% post-Q1. Sambhav AUM reaches INR 12,000 crores by FY27.

BAJAJHFL – Bajaj Housing Finance – Q4 FY26 Financial Results – 27-Apr-26

BajajHFL compounds steadily with 18.4% PAT growth, sub‑0.3% NPAs, and clean equity. CRAR compression (22.46%) flags a capital raise risk within 12–18 months, threatening EPS unless ROE expands. Rising impairments hint at loan‑book seasoning; long‑term housing credit gap tailwinds hinge on disciplined capital adequacy navigation.

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🔍 Observations

Topline

Total Revenue from Operations grew 16.7% YoY (₹9,554 → ₹11,147 Cr), anchored by Interest Income rising 17.0% (₹8,986 → ₹10,512 Cr) as the loan book expanded sharply.
Fees & commission income surged 47.7% YoY (₹201 → ₹297 Cr), signalling improving cross-sell and processing fee capture.
QoQ revenue was nearly flat (₹2,884 → ₹2,903 Cr, +0.7%), indicating sequential momentum has plateaued near-term.

Bottomline

PAT grew 18.4% YoY (₹2,163 → ₹2,560 Cr), outpacing revenue growth — a positive operating leverage signal.
Q4FY26 PAT of ₹669 Cr grew 14.1% YoY (vs. ₹587 Cr Q4FY25) and was marginally ahead of Q3FY26 (₹665 Cr), showing steady quarterly earnings.
Effective tax rate for FY26 was 22.9% (₹760 Cr tax on ₹3,320 Cr PBT), slightly elevated vs. FY25’s 21.9% — partly due to absence of prior-year tax credits (₹25 Cr benefit in FY25).

Margins

Net Profit Margin improved modestly to 22.96% in FY26 vs. 22.64% in FY25 — limited expansion despite volume growth, as Finance Costs scaled proportionally (₹5,979 → ₹6,759 Cr, +13.1%).
Impairment on financial instruments more than tripled YoY (₹58 → ₹191 Cr), creating a drag on pre-provision profitability — though absolute NPA ratios remain benign.
Cost-to-income compression is gradual: Employee + Other expenses grew 13.5% YoY (₹693 → ₹807 Cr) vs. 16.7% revenue growth — marginal operational efficiency gain.

Growth Trajectory

Loan book grew 24.3% YoY (₹99,513 → ₹1,23,745 Cr), significantly ahead of revenue growth, implying some yield compression or mix shift.
EPS grew 15.0% YoY (₹2.67 → ₹3.07), with no equity dilution in FY26 (share capital unchanged at ₹8,329 Cr) — full growth accrues to existing shareholders.
CRAR compressed sharply from 28.24% to 22.46%, a 578 bps decline YoY — rapid balance sheet expansion is consuming regulatory capital headroom.

BAJAJHFL – Q3 FY26 Earnings Call – 2-Feb-26

Bajaj Housing Finance’s growth hinges on strong disbursements despite attrition, with affordable housing as a key driver. PAT growth looks sustainable if credit costs stay low, though capital volatility and assignment reliance limit upside. NIM stability faces pressure from rising G-Sec yields.

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3-Scenario Framework

📊 Base Case (50% Probability)

Key Variables: (1) Rate stabilization by H1 FY27, (2) Affordable segment credit costs at 20–25 bps.
Outcome: BT-out normalizes to 15%; Sambhav reaches ₹500 crore/month run rate; NIM holds at 3.9–4%. Financials: AUM growth 18–20%; ROE 12–13%.