Global brokerage Nomura remains optimistic about Bajaj Finance despite facing regulatory challenges and competitive pressures. According to reports from Business Standard, Nomura estimates the company's assets under management (AUM) to grow 25% year-on-year for FY27, despite regulatory overhang from the Reserve Bank of India's draft norms on revolving credit products and growing competition in personal loans. The brokerage has raised its target price for Bajaj Finance to ₹1,270 from ₹1,140 earlier, reflecting confidence in the company's growth prospects. As reported by The Economic Times, brokerages remain constructive on a diverse set of consumer, financial and textile plays, despite near-term challenges around input costs, regulation and competitive pressures.
The stock has faced some selling pressure earlier this month following the RBI's proposal to allow NBFCs to offer only term loans and discontinue revolving credit products, except for those authorized to issue credit cards. As reported by Business Standard, Deputy Governor Shirish Chandra Murmu has indicated that the RBI is open to suggestions and will consider practical challenges due to the draft regulation on revolving credit. However, he reiterated that revolving credit was never allowed for NBFCs, and this regulation was brought in for better clarity. Nomura notes that the definition of revolving credit in the draft RBI document left much open for interpretation, and awaits clearer definitions in the final regulation. The stock has shown resilience with 12.56% gains in 2026 and 22.18% growth over the past year, though it was trading flat on Friday.
Concerns around the company's urban personal loan book have kept sentiment in check, with growth slowing down to below 20% from Q3FY26 due to elevated competitive intensity. According to Nomura's analysis reported by Business Standard, Bajaj Finance's personal loan book remains equal to the cumulative book of nine next NBFCs. Despite these challenges, the company's personal loan book continues to be a significant contributor to overall growth, though competitive pressures have moderated its expansion rate. The growth slowdown in the personal loan segment has been a key factor affecting overall performance metrics.
Management plans for gold loan scale-up and MSME loan recovery from Q3FY27 could lead to 24-26% year-on-year AUM growth in the closing quarter of FY27F. As reported by Business Standard, Nomura analysts believe Bajaj Finance's consolidated AUM growth in Q2FY27 could be subdued due to regulation on flexi loans and competitive intensity. However, management during its Q4FY26 results conference call had guided for 22-24% AUM growth for FY27. Nomura has also lifted net profit estimates by 3% over FY27-29F. As reported by The Economic Times, brokerages expect gold loans and an MSME recovery to support AUM growth, with management's diversification strategy showing positive results.
