Bajaj Finance shares jump 5%, halt 3-day losing run; Bajaj Finserv up 3%

Shares of Bajaj Finance surged more than 5 per cent in Monday's trade, pausing their losing run of three straight sessions. The stock jumped 5.39 per cent to hit a day high of Rs 6,066.05 over its previous close of Rs 5,756.

JM Financial Institutional Securities has assigned a 'Buy' call on the counter with a target price of Rs 8,000.

"In Q3 FY23, Bajaj Finance delivered healthy profit after tax (PAT) of Rs 2,970 crore (40 per cent YoY/7 per cent QoQ), notwithstanding a tad softness in AUM growth (27 per cent YoY/6 per cent QoQ). We see no challenges to growth opportunities as it begins selling existing products at a higher number of physical locations, drives digital penetration in the existing customer base and enters newer categories," the brokerage stated.

Ganesh Dongre, Senior Manager - Technical Research Analyst at Anand Rathi Shares and Stock Brokers, said, "On the daily chart, Bajaj Finance has almost corrected 30 per cent from its high level, but as per technical view, there is no reliable pattern that we can see on the chart yet. If it closes above Rs 6,100 in the upcoming trading session, a short-term bounce up to Rs 6,500 level could be seen. Short-term traders can consider buying this stock above Rs 6,100 with a stop loss placed at Rs 5,800 for a target price of Rs 6,500."

Sneha Seth, Derivatives Research Analyst at Angel One, said, "Today, we are witnessing volume-based buying post-opening trade to reclaim Rs 6,000 plus zone. In case of a strong close today and follow-up buying beyond the Rs 6,100-odd zone, it may attract further momentum which could bring it towards Rs 6,300-6,350. On the lower side, Rs 5,750-5,800 would now act as a strong demand zone."

Pavitraa Shetty from Tips2trades said, "Excellent Q3 FY23 results comfortably beating Street estimates has led to a sharp uptrend in Bajaj Finance today. A daily close of above Rs 5,935 level could lead to targets of Rs 6,145-6,460 in the near term. Support will be at Rs 5,770."

Around 74,000 shares changed hands today on BSE, which was higher than Bajaj Finance's two-week average volume of 40,000 shares. Turnover on the counter stood at Rs 44.31 crore, commanding a market capitalisation (m-cap) of Rs 3,65,534.86 crore.

The stock was last seen higher than 5-day moving averages but lower than 20-day, 50-, 100- and 200-day moving averages. The counter's 14-day relative strength index (RSI) came at 45.86. A level below 30 is defined as oversold while a value above 70 is considered overbought. The company's stock has a price-to-equity (P/E) ratio of 35.85.

Bajaj Finance has an average target price of Rs 8,138.67, Trendlyne data showed, suggesting a potential upside of 34.75 per cent. The scrip has a one-year beta of 1.37, indicating high volatility.

In what could be seen as a rub-off effect, shares of Bajaj Finserv also climbed. The stock advanced 3.43 per cent to hit a day high of Rs 1,359.90 today against a previous close of Rs 1,314.85.

Anand Rathi's Dongre said, "On the daily chart, Bajaj Finserv has almost corrected 35 per cent from its high. On the weekly chart pattern, the stock is still in sell mode. So, investors can wait for some more time to invest in this stock or can accumulate this counter for future gains. In the upcoming session, support for the stock is at Rs 1,100-1,200 zone and resistance at Rs 1,500 level."

Angel One's Seth said, "Bajaj Finserv has been struggling for quite some time now, in fact, any minor pullback moves are even being sold into. Considering the overall chart structure, we don't expect any positive momentum to attract this counter any time soon. Though we are observing some buying interest with volumes today, any sustainable move beyond 20-DEMA in the daily chart frame shall be important to watch out for. On the lower side, any dips towards Rs 1,230-1,250-odd zone should bring it towards the rising trendline support in the monthly chart frame, which could be an opportunity to add fresh longs."

Tips2trades' Shetty said, "Bajaj Finserv looks oversold and bullish on the daily charts. A daily close of above Rs 1,350 could lead to targets of Rs 1,429-1,550 in the near term."

As per Trendlyne, the counter has an average target price of Rs 1,914.33, indicating a potential upside of 41.54 per cent.

Indian equity benchmarks were seen trading slightly lower in afternoon deals amid a volatile session today, dragged by banks, financials, consumer, metal and energy stocks.

 
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