Bajaj Finserv Q2 FY26: 11% Income Growth, 24% Stake Dividend Boost
* Consolidated revenue/ total income: ₹37,402.93 crore — +11.0% YoY.
* Profit after tax (PAT): ₹2,244.10 crore — +7.5% YoY.
* Profit before tax (PBT): ₹6,825.13 crore — +14.4% YoY.
* Interest/ finance income (group level driver): ₹19,599 crore — +18% YoY (driven by loan growth and consumer finance traction).
* AUM (where reported for group lending businesses): advanced strongly — media notes AUM growth of ~24% YoY (Bajaj Finance consolidation effect).
*What moved the top line and P&L*
* The group’s revenue rose ~11% because its lending and insurance subsidiaries continued to grow volumes (more loans, more fees and interest). The sharp growth in interest income (+18%) shows lending businesses were the key engine this quarter.
* PBT grew faster (+14.4%) than PAT (+7.5%), indicating items below PBT (tax, minority interest, and some non-operating items) moderated the PAT growth. The investor note/disclosure also highlights mark-to-market swings in insurance investments that affected PAT comparatives.
*Important segment/ subsidiary moves*
* Bajaj Life Insurance (Bajaj Life): Value of New Business (VNB) jumped to ₹367 crore — a ~50% increase YoY. New Business Margin (NBM) expanded sharply to 17.1% (19.3% excluding GST). However, Bajaj Life’s reported quarterly PAT fell (GST impact of ~₹112 crore was cited) — results here are mixed: strong sales economics but short-term PAT hit from tax/GST timing.
* Bajaj General/ Life MTM: The filings/investor note mention unrealised MTM losses (for the quarter) — around ₹70 crore (Bajaj General) and ₹91 crore (Bajaj Life) — this is a part of the lower-level volatility in PAT this quarter.
*Key ratios & efficiency*
* PBT growth (14.4%) > Revenue growth (11%) — suggests margin expansion at operating profit level (or one-off gains in PBT).
* AUM growth ~24% (for lending businesses) implies strong balance sheet expansion — this supports future interest income but requires watching asset quality and funding costs.
*Positive points*
* Healthy growth in underlying finance business (interest income up and AUM growth) — shows demand and distribution strength.
* Bajaj Life’s VNB/ NBM improvement — good for long-term value creation even if near-term PAT was hit by GST timing.
*Risks*
* MTM swings in insurance investments (₹70–₹91 crore style items) can cause quarter-to-quarter volatility in consolidated PAT — keep an eye on investment mark-to-market and any one-offs.
* Funding & asset quality: higher AUM is positive, but monitor loan-losses/ provisions and cost of funds in coming quarters (pressures there can compress margins). Company commentary and investor presentations will clarify management’s view.
*Conclusion*
Bajaj Finserv delivered a steady quarter — double-digit income growth (~11%) and stronger PBT (+14.4%), while PAT rose ~7.5%. The numbers show healthy franchise growth (AUM +24%, interest income +18%) and improving insurance economics (VNB up 50%), but near-term PAT was affected by MTM and GST items. Overall, operational momentum is visible but watch volatility in insurance investments and near-term tax/ GST impacts.
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