Bajaj Finance Q2 adds ₹37,680 crore AUM and 29% profit growth
Bajaj Finance, the lender that cross-sells consumer, personal, MSME and mortgage loans to mass and affluent households, filed its Q2 FY27 investor presentation on 19 October 2026. Consolidated assets under management rose 26% to ₹584,624 crore and profit after tax rose 29% to ₹6,367 crore, while the board separately approved a capital raise of up to ₹17,500 crore . The quarter shows core credit costs falling even as growth ran above its long-term corridor .
Profit grew faster than loans as core provisions fell
Income growth held up while underlying loan losses declined, so profit outpaced balance-sheet growth. Reported provisions rose only slightly because a prudential overlay hid a fall in core provisions .
Source: .
| Consolidated, ₹ crore | Q2 FY27 | Q2 FY26 | FY26 |
|---|---|---|---|
| Net interest income | 13,335 | 10,785 | 44,110 |
| Net total income | 15,974 | 12,982 | 53,324 |
| Pre-provision operating profit | 10,699 | 8,685 | 35,548 |
| Profit before tax | 8,537 | 6,608 | 25,817 |
| Profit after tax | 6,367 | 4,948 | 19,332 |
Source: .
| Consolidated margins | Q2 FY27 | Q2 FY26 |
|---|---|---|
| Opex to net total income | 33.0% | 33.1% |
| Annualised return on assets | 4.6% | 4.5% |
| Annualised return on equity | 20.6% | 19.1% |
Net interest income means interest earned less interest paid. Excluding the ₹337 crore management and macro-economic overlay, provisions fell 12% and profit before and after tax each grew 34% . Efficiency was flat on the year, with a 25-40 basis points improvement guided for FY27 . Returns stayed inside the long-term construct of 4.3%-4.7% for assets and 19%-21% for equity . In Q1 FY27 profit had grown 28% with returns at the top of that range, and management said momentum looked better than March guidance but asked to wait another quarter before revising .
AUM ran above corridor as mortgages and gold led growth
Consolidated growth of 26% sits above the reiterated 23%-25% corridor, after a second straight quarter of near-record additions .
Source: .
| AUM, ₹ crore | Q2 FY27 | Q2 FY26 |
|---|---|---|
| Bajaj Finance standalone | 426,879 | 338,121 |
| Bajaj Housing Finance | 158,205 | 126,749 |
| Consolidated | 584,624 | 462,261 |
The Q2 addition was ₹37,680 crore, following ₹36,969 crore in Q1 FY27 to ₹546,944 crore from a FY26 base of ₹509,975 crore . The consolidated lending mix was 30% urban, 12% rural, 13% MSME, 13% commercial and 32% mortgages .
Source: .
| Segment, ₹ crore | Q2 FY27 | YoY |
|---|---|---|
| Mortgages | 187,133 | 30% |
| Urban personal loans | 115,237 | 19% |
| Gold loans | 24,195 | 105% |
| Urban consumer finance | 48,098 | 43% |
| Rural consumer finance | 14,392 | 63% |
| MSME lending | 53,084 | 3% |
Mortgages remain the largest block, with home loans up 22%, loan against property up 43%, lease rental discounting up 43% and developer finance up 13% . Gold more than doubled and lifted its share to 4.14% from 2.55% . MSME was the outlier after deliberate pruning since last July, with recovery expected by Q3 FY27 . The run-down captive two- and three-wheeler book fell 66% to ₹2,387 crore . In Q1, management said about half the consumer strength was higher ticket prices and half was volume .
Loan and customer additions stayed strong despite festival shift
Volume growth is clouded by timing, but franchise compounding continued. The company said year-on-year loan volume is not comparable due to early onset of festival season last year .
Sources: Q2 FY27, Q2 FY26 — ; Q1 FY27 — .
| Q2 FY26 | Q1 FY27 | Q2 FY27 | |
|---|---|---|---|
| New loans, MM | 12.17 | 16.13 | 13.45 |
| New customers, MM | 4.13 | 5.10 | 4.42 |
| Total franchise, MM | 110.64 | 124.43 | 128.85 |
The company expects to disburse 6-6.20 crore loans and add 1.80-2 crore customers in FY27 . Cross-sell franchise, customers eligible for more products, stood at 8.24 crore . In Q1, existing-customer share had risen to about 63% from 60%, which supports lower credit cost .
Bad loans improved on year; Stage 2 gold balances rose
Gross bad loans, loans overdue over 90 days, and net bad loans after provisions improved year on year but ticked up sequentially . Separately, the company highlighted a transitional increase in Stage 2 gold loans .
Source: .
| Consolidated asset quality | 30 Sep 2025 | 30 Jun 2026 | 30 Sep 2026 |
|---|---|---|---|
| Gross NPA | 1.24% | 0.96% | 1.06% |
| Net NPA | 0.60% | 0.39% | 0.42% |
| Stage 3 cover | 51.79% | 59.67% | 60.41% |
Stage 2 and 3 balances rose ₹1,601 crore to 2.02% of loans from 1.87%, including ₹1,047 crore from short-tenor gold schemes that are no longer offered . The company expects no credit-cost impact from that shift. On its measure adjusted for the transient movement in gold loans, the combined Stage 2 and 3 ratio improved to 1.88% from 1.90% in Q1 FY27 . Gold-loan provision cover was 0.67% for Stage 2 and 5.00% for Stage 3. The low Stage 2 cover diluted the blended Stage 2 ratio to 38.79%; excluding gold, that ratio was 48.03% . Annualised loan loss to average finance assets was 1.56% against 1.88%, and 1.32% excluding the overlay . Vintage performance across 3, 6 and 9 months on book keeps improving, and management is optimistic on FY27 credit costs . In Q1 vintages were already below the pre-Covid FY20 benchmark . The April deck guided FY27 net loan loss to 1.45%-1.60% .
Housing and broking arms added steady profit
Both subsidiaries grew assets and profit, with housing crossing ₹1.5 lakh crore .
Source: .
| Q2 FY27, ₹ crore | Profit before tax | Profit after tax |
|---|---|---|
| Bajaj Finance standalone | 7,421 | 5,536 |
| Bajaj Housing Finance | 980 | 757 |
| Bajaj Financial Securities | 86 | 64 |
| Consolidated | 8,537 | 6,367 |
Housing disbursements rose 25% to ₹19,935 crore, net interest income grew 10% to ₹1,055 crore, costs to income improved to 19.1% from 19.7%, and gross and net bad loans were 0.29% and 0.12% . Broking AUM grew 59% to ₹12,058 crore, split as margin funding of ₹10,498 crore and ESOP financing of ₹1,560 crore, with costs to income improving to 45.6% from 51.1% . The three blocks plus associates broadly tie to consolidated profit, with small consolidation differences . In Q1, housing had its highest-ever quarterly addition while broking profit growth was softer at 22% .
Funding costs eased while new capital builds buffer
Consolidated cost of funds was 7.31%, improving 9 basis points over Q1 FY27 and extending a decline from 7.97% in March 2024 . Standalone cost was 7.40% and housing cost was 7.04%, down 17 basis points sequentially . In Q1, management expected costs to stay range-bound with slight upward bias and saw 10-15 basis points margin moderation for FY27 .
Liquidity buffer was ₹19,995 crore, deposits were ₹69,754 crore at 14% of consolidated borrowings, and daily liquidity coverage was 214% for the parent and 146% for housing against 100% required . Behavioural gaps stayed positive in near-term buckets for both lenders .
Capital adequacy was 20.33% with Tier-1 at 19.43%, against 21.6% in FY26, while consolidated leverage was 5.1 times against 4.8 times in FY26 . The company uses 5-5.5 times for resilience planning . On 1 October 2026 the board approved, subject to shareholders, fresh shares up to ₹11,700 crore via qualified institutions placement and warrants up to ₹5,800 crore to promoter Bajaj Finserv, citing India growth, business momentum and resilience across capital, talent, technology and provisioning . In July management had said first priority was to dilute housing from 86.7% toward 75% .
Cost-to-income ratio stayed broadly flat as branches and AI scaled work
The cost-to-income ratio was broadly stable while operating expenses rose 23% year on year to ₹5,275 crore and physical and digital capacity expanded . Full-time headcount was 75,845 after adding 2,584 in Q2, or 1,058 excluding gold and microfinance, with attrition at 15.1% . Presence was 4,091 locations with over 254,000 active points after adding 4,100 points, with 150-175 new locations planned in FY27 . Gold branches rose by 321 to 2,022 toward 2,700-2,800 by March, and microfinance branches were 480 toward 520-550 .
The company's FinAI transformation is framed as integrating AI across processes to drive operating leverage .
Source: .
| AI progress | Q2 FY26 | Q2 FY27 |
|---|---|---|
| Dedicated AI staff | 121 | 328 |
| Disbursal from bot leads, ₹ crore | 1,295 | 2,744 |
| DIY service via bots | 65% | 75% |
Document auto-checks more than doubled and voice-to-data conversion reached 5.60 crore interactions . Targets for FY27 include 600-plus sub-agents under 250 autonomous agents across 118 use cases .
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