Why Bajaj Finance shares are surging post Budget 2025
What's the story
Leading non-banking financial company (NBFC) Bajaj Finance saw a massive jump in its share price on Monday.
The shares surged by an impressive 5.05%, hitting an all-time high of ₹8,405.95 per share.
The jump came after Finance Minister Nirmala Sitharaman announced the Budget 2025 and proposed to raise the income tax exemption limit to ₹12 lakh under the new tax regime.
Market performance
Bajaj Finance outperforms market with 21% surge
In just the last six trading days, Bajaj Finance's share price has skyrocketed 15%.
On January 30, the stock crossed its previous high of ₹8,190 recorded in October 2023.
Since the beginning of 2025, Bajaj Finance has outperformed the market with an impressive 21% surge, while the BSE Sensex fell 2% in the same period.
Economic forecast
Budget 2025's impact on disposable income and consumption
Analysts expect the proposed changes in the Budget 2025 to boost disposable income and consumption.
CLSA analysts said these measures would lead to higher discretionary cash flows for mid-income households, which could increase durable goods consumption.
Elara Capital's analysts also said this could indirectly benefit retail credit lenders such as Bajaj Finance.
Company portfolio
Bajaj Finance's diverse product suite and loan disbursement
Bajaj Finance has a wide range of products including Consumer Durable Loans, Digital Product Loans, Lifestyle Product Loans, Lifecare financing, EMI Card, Retail spend financing, two-wheeler and three-wheeler financing, Salaried Personal Loans and Retailer finance, etc.
The company has disbursed loans worth ₹3.98 lakh crore with mortgages accounting for 30.7% of the total loan portfolio.
Future prospects
RBI's potential rate cut could further boost Bajaj Finance
The focus now shifts to the Reserve Bank of India (RBI), with many analysts predicting a 25-basis-point rate cut from the RBI.
This move could further benefit Bajaj Finance as lower interest rates reduce borrowing costs for NBFCs, potentially boosting their profit margins.
In Q3FY25, Bajaj Finance reported an 18% YoY increase in net profit at ₹4,308 crore due to strong loan growth during the holiday season.