The average analyst price target on Bajaj Finance available on Bloomberg after the third quarter results stood at ₹8,721.69, implying an upside of 27.9% over Tuesday’s closing.
Analysts said they did not cut their ratings on the stock because of the recent underperformance.
“After Bajaj Finance reported its pre-quarterly update on January 3, the stock has underperformed Nifty,” said HSBC in a note to clients. “We believe this adequately factors in the current earnings cut, leaving limited downside, in our view.”
Bajaj Finance shares have dropped 11.4% since January 4 as against the flat performance in the Nifty.”After a sharp stock underperformance, valuations look reasonable to prompt an upgrade to ‘Add’ from ‘Reduce’,” said Kotak Institutional Equities in a note to clients.Analysts said earnings missed estimates on account of lower fees, higher credit costs, and a sharp sequential increase in NPAs. They are watching the elevation of Anup Saha to the post of deputy MD. “BAF maintained all of its guidance on growth/return ratios despite reining in growth in unsecured segments due to increased traction in other portfolios,” said Nomura in a client note.
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