Bajaj Finance lifts standalone margin as revenue growth outpaces costs
Q1FY27 margin reached 67.20%, while management flagged a Rs 296 crore provision and a Rs 328 crore rise in stage 2 and 3 assets.
Filed 30 Jul 2026, 15:19 IST · Bajaj Finance Ltd (BAJFINANCE)
Key takeaways
- Standalone net profit grew 29.34% YoY as revenue rose 18.60% while expenses increased 14.10%.
- Operating margin expanded 1.30 percentage points YoY to 67.20%, putting Bajaj Finance 4.52 percentage points above the 32-peer sector median.
- Management said Q1 included a prudent Rs 296 crore provision, while stage 2 and 3 assets increased by Rs 328 crore.
Price around the results
Revenue growth continued to run ahead of costs
Bajaj Finance's standalone revenue grew 18.60% YoY and 7.45% QoQ, while expenses rose more slowly at 14.10% YoY and 4.42% QoQ. That operating leverage lifted operating profit growth to 20.93% YoY and 8.99% QoQ. Interest expense increased 12.49% YoY, but profit before tax still grew 29.15%; the tax rate was down 0.11 percentage points YoY and unchanged QoQ. Other income contributed only 0.01% of pre-tax profit, so the earnings increase was not driven by a non-operating gain.
Margin recovery extended into a second straight quarter
Operating margin widened by 1.30 percentage points YoY and 0.95 percentage points QoQ to 67.20%, as revenue growth exceeded expense growth. After falling to 57.91% in Q3FY26, the margin recovered to 66.25% in Q4FY26 and then 67.20% in Q1FY27. The company was 4.52 percentage points above the 62.68% median operating margin for the 32 Financial Services peers that had reported the quarter.
Management flagged provisions and asset-stage movement
Management said Q1 included a prudent management and macroeconomic provision of Rs 296 crore. It also said stage 2 and 3 assets rose by Rs 328 crore, comprising a Rs 206 crore increase in stage 2 assets and a Rs 122 crore increase in stage 3 assets. The company said it added 1,648 full-time employees in the quarter, or 811 excluding Gold Loan and MFI. For FY27, management said it is confident of improving Opex to net total income by 25-40 basis points and remains optimistic on credit costs, subject to no material adverse geopolitical effects.
Past results have more often been followed by declines
With the results still fresh, the stock's past eight post-results moves provide the market context: it rose three times and fell five times, with a median absolute move of 1.83%. Recent moves included declines of 7.35% and 5.04%, making the historical pattern more negative than positive, though the typical move has been modest.
Q1FY27 at a glance
Standalone figures as filed with NSE — filed ahead of third-party databases, not yet independently cross-checked.
| Line item | Q1FY27 | Q4FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹19,802 cr | ₹18,430 cr | +7.45% | +18.60% |
| Other income | ₹1 cr | ₹1 cr | +28.85% | +17.54% |
| Expenses | ₹6,496 cr | ₹6,221 cr | +4.42% | +14.10% |
| Operating profit | ₹13,307 cr | ₹12,209 cr | +8.99% | +20.93% |
| Operating margin (%) | 67.20% | 66.25% | — | — |
| Interest | ₹5,874 cr | ₹5,487 cr | +7.05% | +12.49% |
| Depreciation | ₹270 cr | ₹238 cr | +13.53% | +14.57% |
| Profit before tax | ₹7,163 cr | ₹6,484 cr | +10.46% | +29.15% |
| Tax | ₹1,817 cr | ₹1,645 cr | +10.49% | +28.60% |
| Net profit | ₹5,346 cr | ₹4,840 cr | +10.46% | +29.34% |
| EPS (₹) | ₹8.60 | ₹7.78 | +10.54% | +29.13% |
Operating margin of 67.20% compares with a Financial Services sector median of 62.68% across 32 peers that have reported Q1FY27.
What management said
From the company’s own investor presentation. Each point is checked against the source document before it appears here.
This quarter
- The company added 1,648 full-time employees in Q1 FY27, or 811 excluding Gold Loan and MFI.
- Bajaj Financial Securities added 5,000 UHNI and HNI clients in Q1 FY27.
Guidance & outlook
- The company is confident of improving Opex to net total income by 25-40 basis points in FY27.
- The company is optimistic about the credit cost outlook for FY27, subject to no material adverse geopolitical effects.
Planned next quarter
- The company plans to enable customer discovery across leading AI platforms such as ChatGPT and Gemini in Q2 FY27.
- The company plans to use AI to enable incremental volume of approximately five lakh accounts for its sales finance business in Q2 FY27.
Problems & risks
- Q1 FY27 included a prudent management and macroeconomic provision of ₹296 crore.
- Stage 2 and 3 assets increased by ₹328 crore in Q1, including a ₹206 crore rise in stage 2 assets and ₹122 crore in stage 3 assets.
- The FY27 credit cost outlook is contingent on there being no material adverse effects from geopolitical events.
What to watch
- Whether operating margin stays above 67.20% after two consecutive quarterly improvements.
- Whether stage 2 and 3 assets reverse the Rs 328 crore Q1 increase.
- Whether Opex to net total income records the 25-40 basis points FY27 improvement management said it expects.