New Delhi, Nov. 11 -- Bajaj Finance Ltd stock tanked 8% on Tuesday despite clocking healthy growth in assets under management (AUM) in the September quarter (Q2FY26). Elevated credit cost has been its Achilles' heel, making investors edgy. On a consolidated basis, Bajaj Finance reported a credit cost of 2.05% in Q2FY26 versus 2.02% in Q1FY26 and 2.04% in H1FY26. This was higher than the guided 1.85-1.95%. Credit costs remained higher largely due to micro, small and medium enterprises (11% of AUM) and captive two- and three-wheelers (1.5% of AUM).

Overleveraging by borrowers, weak business recovery in small business pockets and competitive intensity from fintechs hurt the MSME portfolio. However, Bajaj Finance expects FY26 credit cost to ...