Bajaj Housing Finance Ltd, a non-deposit-taking housing finance company (HFC) under the Bajaj Group, witnessed a significant drop in its stock price on Thursday, falling 6.08% to settle at ₹132.80. The dip came after a brief pause in its downward trend, accompanied by a surge in trading volume. Approximately 51.08 lakh shares exchanged hands on the BSE, far exceeding the two-week average of 13.17 lakh shares. The turnover stood at ₹68.47 crore, with the company’s market capitalization now at ₹1,10,597.79 crore.
Q2 FY25 Performance
In the September 2024 quarter, Bajaj Housing Finance reported a strong 20.95% year-on-year increase in net profit to ₹545.60 crore, compared to ₹451.11 crore in the same period last year. Revenue from operations also rose 26.09% YoY to ₹2,410.15 crore. These numbers highlight the company’s robust financial performance despite the recent stock market volatility.
Market Sentiment and Key Insights
Kranthi Bathini, Director of Equity Strategy at WealthMills Securities, remains optimistic about the stock, citing its strong fundamentals and potential benefits from any rate cuts by the Reserve Bank of India (RBI). Rate cuts could improve net interest margins (NIMs) for housing finance companies, including Bajaj Housing Finance. However, with the RBI maintaining its key interest rate at 6.50% due to high inflation, rate cuts are expected only in 2025, potentially starting in February.
Technically, the stock appears bearish on the charts. Analysts identify a support zone in the ₹125-130 range, with resistance levels at ₹138-140. A breakdown below ₹125 could lead to further downside, while a breach above ₹140-147 could spark a rally.
Expert Analysis
- Osho Krishan, Senior Research Analyst at Angel One, sees ₹125-128 as a crucial support zone, with intermediate resistance at ₹138-140 and a major hurdle at ₹147.
- Jigar S Patel, Senior Technical Research Analyst at Anand Rathi, anticipates the stock trading between ₹130 and ₹145 in the short term, with a move above ₹140 possibly paving the way for ₹145.
Investor Outlook
While the stock remains under pressure, analysts suggest a medium- to long-term investment perspective for those looking to leverage the company’s strong pedigree and earnings visibility. Any favorable monetary policy changes in 2025 could act as a catalyst for housing finance companies, including Bajaj Housing Finance, making it a stock to watch.
