Bajaj Finance share price jumps over 7% after RBI lifts restrictions on its eCom and Insta EMI Card | Stock Market News (2024)

Bajaj Finance share price jumped over 7% in early trade on Friday after the Reserve Bank of India (RBI) lifted restrictions on the company’s two products eCOM and online digital ‘Insta EMI Card’.

Bajaj Finance shares rallied as much as 7.54% to ₹7,400.00 apiece on the BSE. Meanwhile, Bajaj Finserv shares also surged more than 6%.

The non-banking finance company Bajaj Finance said that it would now resume sanction and disbursal of loans in these two business segments including issuance of EMI cards.

“...the RBI, vide its letter dated 2 May 2024, based on the remedial actions taken by the Company, has conveyed its decision of lifting the said restrictions on eCOM and online digital ‘Insta EMI Card’, with immediate effect,” Bajaj Finance said in a stock exchange filing on Thursday.

The banking regulatory RBI, on November 15, 2023, had ordered Bajaj Finance to stop sanction and disbursal of loans under its two lending products ‘eCOM’ and ‘Insta EMI Card’, with immediate effect.

The RBI action against Bajaj Finance came after the NBFC failed to abide by the central bank’s digital lending guidelines — particularly non-issuance of key fact statements to the borrowers under the two lending products.

Analysts believe though removal of these restrictions by the RBI is on expected lines, the relief within less than 6 months not only comes as a positive surprise but also endorses the company’s management’s ability to course-correct quickly when needed.

“The embargo on the two products had a significant impact on Bajaj Finance’s profitability, and its new loan book was lower by 0.8 mn in Q4 and by 1.2 mn in FY24. Lifting of this ban would result in higher customer acquisition, along with improved fee income,” said Avinash Singh, Senior Research Analyst at Emkay Global Financial Services.

The recent development in the beginning of FY25 itself is a positive start for Bajaj Finance for the fiscal, and is expected to boost investor confidence in processes, commitment of management in making things right, and company’s ability to adapt to the changing regulation & business environment, he added.

The early resolution of the restriction increases confidence on the FY25 outlook and raises hopes of approval by the RBI for renewal of Bajaj Finance co-branded credit card with RBL Bank in December 2024.

Emkay Global kept its FY25-27 estimates unchanged and reiterated its ‘Buy’ rating on Bajaj Finance stock. It has kept March-2025 Bajaj Finance share price target unchanged at ₹9,000 apiece.

Last week, Bajaj Finance reported consolidated net profit at ₹3,825 crore for the fourth quarter of FY24, registering a growth of 21% year-on-year (YoY) . The company’s total income in Q4FY24 rose to ₹14,932 crore from ₹11,368 crore in the year-ago period.

Bajaj Finance’s net interest income (NII) increased 28% during Q4 to ₹8,013 crore.

At 9:20 am, Bajaj Finance shares were trading 6.69% higher at ₹7,341.00 apiece on the BSE.

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