🏠 Bajaj Housing Finance Limited: A Rising Giant in Home Lending
📌 Overview
Bajaj Housing Finance Limited (BHFL), a wholly owned subsidiary of Bajaj Finance, is rapidly emerging as a strong contender in India’s housing finance space. Launched in 2015, it has demonstrated exceptional growth, combining a conservative risk approach with strong execution.
📈 Financial Performance Snapshot
| Metric | FY2020 | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 (Q4 Annualized) |
|---|---|---|---|---|---|---|
| AUM (₹ Crore) | 28,000 | 38,200 | 52,400 | 69,200 | 91,370 | 1,14,684 |
| YoY Growth | — | 36% | 37% | 32% | 32% | 26% |
| Net Interest Income (NII) | — | ₹988 Cr | ₹1,488 Cr | ₹2,010 Cr | ₹2,510 Cr | ₹3,007 Cr |
| Net Profit | ₹450 Cr* | ₹625 Cr* | ₹1,060 Cr | ₹1,437 Cr | ₹1,731 Cr | ₹2,163 Cr |
| EPS (₹) | — | ₹0.93 | ₹1.58 | ₹2.13 | ₹2.58 | ₹2.67 |
| Net Interest Margin (NIM) | — | ~3.7% | 4.0% | 4.1% | 4.1% | 4.0% |
| Gross NPA | — | 0.30% | 0.28% | 0.29% | 0.29% | 0.29% |
| Net NPA | — | 0.10% | 0.11% | 0.11% | 0.11% | 0.11% |
| Return on Equity (ROE) | — | ~11% | 12.5% | 13.2% | 14.2% | — |
* FY2020/2021 Net Profit estimates based on backward calculation using reported CAGR.
🚀 Growth Track Record
AUM CAGR (FY2020–FY2024)
- CAGR: ~34%
EPS CAGR (FY2021–FY2024)
- From ₹0.93 to ₹2.58 → CAGR: 41.4%
This growth trajectory demonstrates both scalability and profitability.
🧱 Business Mix (as of FY2024)
| Loan Category | Share of AUM |
|---|---|
| Home Loans | 58% |
| Loan Against Property (LAP) | 10% |
| Lease Rental Discounting (LRD) | 19% |
| Developer Finance (DF) | 11% |
| Others | 2% |
🌍 Geographic Footprint
- Present in 174 locations across India
- Focused on Tier I and expanding to Tier II cities
- Strong digital lending framework with offline onboarding
🔐 Risk Management and Asset Quality
- Gross NPA: 0.29%
- Net NPA: 0.11%
One of the cleanest loan books in the industry, even better than many established banks and NBFCs.
⚙️ Operational Efficiency
- Opex to Net Income:
- FY2023: 23.0%
- FY2024: 20.7%
Efficient operations and tech-driven processes have enabled the company to scale while reducing costs.
🧮 Valuation Scenario
Assume today’s EPS is ₹2.67 and the stock gets listed in the future. Let’s simulate 5-year forward pricing scenarios.
📊 Price Projection Table
Current Price: 117 Current PE: 45.2
| Metric | Worst Case | Base Case | Best Case |
|---|---|---|---|
| EPS Growth | 15% | 20% | 25% |
| PE Multiple | 20 | 30 | 40 |
| EPS After 5 Years | ₹5.21 | ₹6.45 | ₹7.91 |
| Price After 5 Years | ₹104.20 | ₹193.50 | ₹316.40 |
| CAGR Returns | -2.3% | 10.6% | 19.5% |
to make 18-20% cagr returns it needs to be priced at ₹85, at current price we can expect 10-12% cagr returns in next 5 years.
📌 Note: The stock is not yet listed, and the above is hypothetical based on current business metrics.
📝 Summary
Bajaj Housing Finance Ltd. is a textbook example of controlled, profitable, and sustainable growth in a high-potential sector. With industry-beating asset quality, strong parentage, digital enablement, and growing market share, BHFL could be a major player in the next wave of Indian lending transformation.
💡 If the company lists independently, it could unlock significant shareholder value over the next 5–10 years.
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