Bajaj Finance Ltd. makes a corporate announcement

The Rs 2,120 crore zero-coupon NCD allotment could not be confirmed from the Q1/Q2 FY27 filing evidence, so its effective YTM and tenor cannot be calculated reliably. The available allotment filings instead show a Rs 2,000.90 crore and Rs 2,504.25 crore two-tranche issue on 12 June 2026, carrying 7.93% and 8.00% coupons respectively—not a Rs 2,120 crore zero-coupon issue ^[6]—and a separate Rs 5,306.57 crore issue on 6 July 2026 ^[7].

For a zero-coupon NCD, the effective YTM requires the issue price or proceeds, redemption value and exact maturity date. Those inputs for the alleged Rs 2,120 crore allotment could not be confirmed; therefore, no defensible YTM or tenor comparison can be made.

The latest reported quarterly period is Q2 FY27. The available analyst note cites Bajaj Finance’s cost of funds at 7.31%, down 9 bps QoQ, but this is not identified as a company-reported WACF in a quarterly filing ^[8]. Accordingly:

• Effective YTM: Could not be confirmed.
• Tenor: Could not be confirmed.
• Most recent quarterly WACF: Could not be confirmed as a separately reported filing metric.
• Cost comparison: Not determinable. The 7.31% cost-of-funds figure should not be treated as the company’s WACF without an explicit basis match.

Verdict: Assuming the full Rs 17,500 Crores equity raise is subscribed and the warrants are eventually converted, Bajaj Finance’s standalone Debt-to-Equity ratio would fall from 3.34x at September 30, 2026 to approximately 2.88x, below its recent comparable range of 3.06x–3.34x. Adding the Rs 5,306.57 Crores July 2026 NCD issuance again would produce approximately 2.93x, but that would double-count debt already reflected in the September 2026 reported ratio.

Leverage comparison

The calculation uses September 2026 standalone net worth of Rs 110,908.80 Crores ^[9], the reported 3.34x D/E ratio ^[9], and the proposed Rs 11,700 Crores QIP plus Rs 5,800 Crores preferential warrant issue ^{[4] [13]}. The warrants require 25% payment at allotment and the remaining 75% on conversion ^[3]; therefore, 2.88x is a fully subscribed and fully converted scenario, not the immediate ratio on warrant allotment.

The July 2026 NCD allotment of Rs 5,306.57 Crores ^[7] occurred before the September 30, 2026 reporting date. Consequently, it is already embedded in the latest reported balance sheet and should not be added again. If treated mechanically as an additional post-September debt issue, the standalone ratio would be approximately 2.93x, still below the historical range, but that is not the cleanest pro-forma measure.

Regulatory comparison

A numerical NBFC Debt-to-Equity ceiling could not be confirmed from the cited filings. The disclosed RBI benchmarks are different metrics:

• The company is classified as a deposit-taking NBFC-ICC and NBFC-UL ^[14].
• The RBI capital adequacy norm cited by the company is 15%; standalone capital adequacy was 21.55% at March 31, 2026 ^[15].
• Standalone capital adequacy was 20.33% for the half year ended September 30, 2026 ^[9].

Thus, the proposed equity raise clearly improves leverage and capital headroom, but the 2.88x D/E ratio should not be described as being below a specific regulatory D/E limit based on these filings. The available regulatory benchmarks are capital adequacy and liquidity requirements, not a disclosed D/E ceiling.

Objects of the issue

The proposed Rs 17,500 Crores equity mobilisation is split between the QIP and promoter warrants as follows:

In aggregate, the proposed equity proceeds are therefore earmarked 80% for debt repayment/refinancing and 20% for general corporate purposes, net of issue expenses ^{[4] [13]}. The allocation is based on management estimates, and the Board may modify the utilisation schedule subject to applicable law ^{[4] [13]}.

For the debt side, a separate issue-specific objects split for the July 2026 NCD could not be confirmed from the allotment filing. An earlier NCD utilisation statement describes the broader deployment categories as long-term resources, financing activities, repayment of existing loans, liquidity and statutory requirements, capital expenditure, and working capital ^[16].