Bajaj Finance Q1FY26 Earnings: NBFC’s Net Profit Rises 22% to Rs 4,765 Crore

Bajaj Finance Limited, one of India’s leading non-banking financial companies (NBFCs), announced its financial results for the first quarter of FY26, revealing a solid 22% year-on-year increase in consolidated net profit to Rs 4,765 crore. This strong performance underscores the company’s sustained growth trajectory and robust business fundamentals amid a competitive lending environment in India.

Strong Growth in Net Interest Income and Loan Disbursements

The key driver of Bajaj Finance’s profit growth was a remarkable 22% jump in net interest income (NII), which rose from Rs 8,365 crore in Q1FY25 to Rs 10,227 crore in Q1FY26. This rise reflects increased loan disbursements and improved asset quality management.

• Bajaj Finance Q1FY26 earnings

The company booked 13.49 million new loans during the quarter, marking a 23% increase compared to the previous year’s quarter.

Loan growth was broad-based across several segments, including retail, SME, and consumer finance. Notably, asset under management (AUM) surged by 25% to Rs 4.41 lakh crore, reflecting widening customer reach and enhanced lending capacity. Bajaj Finance’s expanding AUM signals growing market confidence and its capacity to capitalize on India’s expanding credit demand in urban and semi-urban locations.

Revenue and Fee Income Expansion

Beyond interest income, Bajaj Finance reported a 17% increase in fees and commission income to Rs 1,784 crore in Q1FY26, contributing to overall revenue growth. Total consolidated revenue rose by 21% to Rs 19,524 crore, up from Rs 16,100 crore a year ago. This was aided by higher loan-related charges and a diversified portfolio that includes retail products, SME lending, and commercial credit solutions.

Asset Quality Challenges and Provisions

Despite the robust earnings, Bajaj Finance has faced some asset quality pressures. Gross non-performing assets (NPAs) increased slightly to 1.03% at the end of the quarter, compared to 0.86% a year ago, while net NPAs also rose to 0.50%. The rise in NPAs was attributed primarily to segments like two- and three-wheeler loans and MSME (Micro, Small, and Medium Enterprises) lending.

The company prudently increased its provisions for loan losses by 26% year-on-year to Rs 2,120 crore, maintaining a cautious stance in anticipation of potential stress in specific portfolios. This enhancement in credit provisioning slightly capped the net profit growth but fortifies the balance sheet against future uncertainties.

Customer Franchise and Outlook

Bajaj Finance’s customer base expanded to 106.51 million as of June 30, 2025, growing 21% from the previous year. This robust franchise growth demonstrates the company’s ability to attract and retain a vast and diversified clientele, which bodes well for future business opportunities.

Looking ahead, Bajaj Finance expects to disburse over 50 million new loans in FY26, an increase from 43.42 million in FY25, reflecting optimistic growth prospects. However, the company is cautious about credit costs in certain segments and is expected to moderate AUM growth in those areas to manage risks effectively.

Strategic Positioning and Market Confidence

Bajaj Finance continues to maintain strong capital adequacy, with a Capital Adequacy Ratio (CRAR) of 21.96% and Tier 1 capital at 21.19%, ensuring it remains well-capitalized to support growth and absorb credit losses.

The company’s leadership, under CEO & MD Rajeev Jain, has consistently focused on innovation, digital transformation, and disciplined risk management, which have contributed to Bajaj Finance’s standout performance in the NBFC sector. This strategic approach has helped Bajaj Finance to post strong results quarter after quarter while peers grapple with stress in unsecured lending segments.

Summary Table of Key Financial Metrics for Q1FY26