Bajaj Holdings & Investment Ltd Upgraded to Hold by MarketsMOJO on Improved Financial and Technical Metrics

Financial Performance Drives Upgrade

The primary catalyst behind the upgrade is Bajaj Holdings’ robust financial trend, which has shifted from flat to positive over the last quarter. The company’s financial grade improved significantly from 4 to 7 in the past three months, signalling enhanced operational momentum. Notably, net sales for the latest six months stood at ₹684.38 crores, representing a strong growth rate of 68.82% compared to previous periods. This surge in sales underpins the company’s improving revenue base and operational efficiency.

Further bolstering the financial outlook is the company’s long-term fundamental strength, with operating profits growing at a compound annual growth rate (CAGR) of 27.22%. This sustained profitability growth highlights Bajaj Holdings’ ability to generate consistent earnings despite market headwinds. The return on equity (ROE) of 10.4% also indicates a reasonable level of shareholder returns, supporting the case for a fair valuation.

Despite these positives, the company’s profits have declined by 2.2% over the past year, and the stock has underperformed the broader market, generating a negative return of -1.47% compared to the BSE500’s 9.00% gain. This underperformance suggests some caution remains warranted, particularly given the competitive pressures in the holding company sector.

Valuation Remains Fair and Discounted

Bajaj Holdings currently trades at ₹11,079.95, marginally up 0.76% from the previous close of ₹10,996.50. The stock is positioned at a discount relative to its peers, with a price-to-book (P/B) ratio of 1.8, which is considered fair given the company’s fundamentals. This valuation metric suggests that the market is pricing in moderate growth expectations, leaving room for upside should the company continue to deliver on its financial targets.

The stock’s 52-week trading range spans from ₹10,406.00 to ₹14,873.20, indicating some volatility but also a significant upside potential from current levels. Investors may find the current valuation attractive, especially in light of the company’s improving financial trajectory and long-term profit growth.

Technical Indicators Signal Mild Improvement

The technical outlook for Bajaj Holdings has also improved, contributing to the upgrade in investment rating. The technical trend has shifted from bearish to mildly bearish, reflecting a more balanced market sentiment. Weekly and monthly Moving Average Convergence Divergence (MACD) indicators remain bearish and mildly bearish respectively, but the Relative Strength Index (RSI) on a weekly basis is bullish, suggesting some upward momentum in the short term.

Bollinger Bands and KST (Know Sure Thing) indicators present a mixed picture, with weekly signals mildly bearish but monthly indicators showing signs of stabilisation. The On-Balance Volume (OBV) indicator is mildly bullish on a monthly scale, hinting at accumulation by investors. Overall, these technical signals suggest that while caution is still advised, the stock is showing signs of bottoming out and potential recovery.

Market Returns and Comparative Performance

Examining Bajaj Holdings’ returns relative to the Sensex reveals a nuanced performance. Over the past week, the stock outperformed the Sensex with a 4.10% gain versus the benchmark’s 2.94%. However, over longer periods, the stock has lagged behind. Year-to-date returns stand at -2.12% compared to the Sensex’s -1.36%, and over the past year, the stock has declined by 1.47% while the Sensex gained 7.97%. Despite this, the company’s long-term returns remain impressive, with a 10-year return of 687.74% far exceeding the Sensex’s 249.97% over the same period.

This disparity highlights the stock’s cyclical nature and the importance of a long-term investment horizon when considering Bajaj Holdings.

Quality Assessment and Shareholding Structure

Bajaj Holdings maintains a Mojo Score of 52.0 with a Mojo Grade of Hold, upgraded from a previous Sell rating. The company’s market capitalisation grade remains at 1, reflecting its status as a large-cap holding company within the finance and NBFC sector. The majority shareholding is held by promoters, which typically provides stability and alignment of interests with shareholders.

There are no key negative triggers currently impacting the company, which supports the positive revision in its financial and technical grades. The absence of adverse developments combined with steady operational performance underpins the Hold rating.

Outlook and Investor Considerations

While Bajaj Holdings has demonstrated encouraging financial improvements and a stabilising technical profile, investors should weigh the stock’s recent underperformance against the broader market and sector peers. The fair valuation and strong long-term fundamentals suggest that the stock is well-positioned for gradual recovery, but near-term volatility cannot be ruled out given mixed technical signals.

Investors seeking exposure to a holding company with solid operating profit growth and reasonable valuation may find Bajaj Holdings an appropriate addition to their portfolio, particularly with a medium to long-term investment horizon. However, those prioritising short-term momentum or higher growth may consider alternative options within the sector.

Summary of Rating Changes

The upgrade from Sell to Hold on 9 February 2026 reflects the following key parameter changes:

• Financial Trend: Improved from flat to positive, with financial grade rising from 4 to 7 due to strong net sales growth and operating profit CAGR of 27.22%.
• Valuation: Remains fair with a P/B ratio of 1.8, trading at a discount to peers, supporting a more favourable outlook.
• Technicals: Shifted from bearish to mildly bearish, with mixed but improving indicators such as weekly RSI bullishness and monthly OBV mild bullishness.
• Quality: Maintains a Mojo Score of 52.0 and a Hold grade, upgraded from Sell, reflecting overall improved fundamentals and market positioning.

These combined factors have led to a more balanced investment stance, signalling cautious optimism for Bajaj Holdings & Investment Ltd going forward.

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