HSBC downgraded Bajaj Housing Finance to reduce from hold, lowering its target price to Rs 90, citing near-term headwinds in growth and profitability. The brokerage highlighted positives such as AUM growth and cost-to-income improvement in Q3 FY25 but flagged concerns over net interest margin (NIM) compression and normalized credit costs, which dragged earnings.
HSBC expects EPS growth to moderate due to pressure on AUM growth, tightening NIMs, and the normalization of credit costs. Consequently, the brokerage reduced its FY25-27 EPS estimates by 3-4%, reflecting a cautious outlook for the stock in the near term.
Bajaj Housing Finance Limited (BHFL) is one of India’s top NBFCs, providing home loans and loans against property at competitive interest rates.
