Bajaj Finance Ltd., a leading non-banking financial company (NBFC) in India, has made significant announcements that will benefit its shareholders, including a stock split, a bonus share issue, and a substantial dividend payout. These decisions were revealed alongside the company’s financial results for the fourth quarter of FY25, which ended on March 31, 2025.
On April 29, 2025, Bajaj Finance's board approved a 1:1 stock split, which means that each equity share of ₹2 will be divided into two shares of ₹1 each. This is not the first instance of a stock split for the company; it previously executed a similar split in 2016, where one share of ₹10 was split into five shares of ₹2. This move aims to enhance liquidity and make shares more affordable for retail investors.
In addition to the stock split, Bajaj Finance announced a 4:1 bonus share issue. For every one share held, shareholders will receive four additional shares. This bonus issue is set to reward investors significantly, reflecting the company's strong financial performance and commitment to enhancing shareholder value.
Furthermore, Bajaj Finance declared a cumulative dividend of ₹56 per share, which includes a final dividend of ₹44 and a special interim dividend of ₹12. The special dividend comes as a result of an exceptional gain from the sale of a stake in Bajaj Housing Finance during its IPO listing in September 2024. This dividend will be credited to shareholders on or about July 28, 2025, subject to approval at the upcoming Annual General Meeting (AGM) scheduled for July 24, 2025. The record date for determining eligibility for the final dividend has been set for May 30, 2025.
In its financial results, Bajaj Finance reported a consolidated net profit of ₹4,545.6 crore for the March quarter, a 19% increase from ₹3,824 crore in the same quarter last year. This profit growth was driven by robust loan demand and improved margins, with net interest income (NII) rising by 22% to ₹9,807 crore, compared to ₹8,013 crore a year earlier.
The company's assets under management (AUM) also saw a significant increase, growing 26% year-on-year to ₹4.17 lakh crore as of March 31, 2025. The AUM grew by ₹18,700 crore during the quarter, indicating strong credit demand and healthy portfolio growth. The customer base expanded to 101.82 million, with 4.70 million new additions, and the number of new loans booked surged by 36% to 10.70 million.
Despite a slightly lower net profit than expected, Bajaj Finance's performance in the fourth quarter was solid. The gross non-performing assets (NPA) ratio improved to 0.96%, down from 1.12% in the previous quarter, while the net NPA ratio eased to 0.44% from 0.48%. This reflects the company's strong asset quality management and effective risk mitigation strategies.
The announcement of the stock split and bonus shares is expected to attract more retail investors, as the company has a significant number of small shareholders. Approximately 6.7 lakh retail investors, holding nominal share capital up to ₹2 lakh, own 6% of the company's equity. This strategic move aligns with the company's goal of enhancing shareholder engagement and increasing its market presence.
As of April 29, 2025, Bajaj Finance shares closed at ₹9,105 on the National Stock Exchange, showing a slight increase of 0.13%. The stock has risen by 33% over the past year and 31% year-to-date, reflecting strong investor confidence in the company's growth trajectory. Analysts remain optimistic, with a majority recommending a 'buy' rating on the stock.
In summary, Bajaj Finance's recent announcements mark a significant milestone for the company and its shareholders. The combination of a stock split, a generous bonus share issue, and a substantial dividend payout underscores the company's robust financial health and commitment to delivering value to its investors. With a strong performance in the fourth quarter and a positive outlook for the future, Bajaj Finance continues to be a key player in the Indian financial sector.
