Bajaj Auto Shares in Focus after Reappointing Rajiv Bajaj, Announcing Rs 1,500 Crore Investment in Credit Unit

Following the board’s decision to prolong Rajivnayan Rahulkumar Bajaj’s term as Managing Director & Chief Executive Officer for another five years, beginning on April 1, shares of Bajaj Auto will be the subject of attention on Wednesday. Additionally, they have approved a maximum investment of Rs 1,500 crore into Bajaj Auto Credit, a firm subsidiary.

The business said on Tuesday that Rajivnayan Rahulkumar Bajaj’s current five-year tenure as its managing director and chief executive officer will end on March 31, 2025. The Board of Directors also authorized his reappointment for a further five-year term, effective April 1, 2025, based on the nomination and compensation committee’s recommendation.

Since joining Bajaj Auto in 1990, Rajiv Bajaj has contributed to several fields, such as supply chain and production, engineering and R&D, and marketing and sales. Since April 2005, he has been the company’s managing director.

Furthermore, on May 20, Abhinav Bindra was appointed a Non-executive Independent Director of the business for a five-year tenure.

Investment in Bajaj Credit:

“At its meeting on March 18, 2025, the Board of Directors approved an additional infusion of funds up to Rs. 1,500 Crore in Bajaj Auto Credit Limited (BACL), a wholly owned subsidiary of the company, either in the form of equity capital, preference capital, or subordinated debt, as may be determined in due course, in one or more tranches,” the company said.

After completing its gradual nationwide expansion in FY2024–2025, BACL is expected to increase the assets under management during FY2025-26 significantly. A Tier-1 and Tier-2 Capital injection is required by regulatory requirements and BACL’s policy on preserving capital adequacy to fund this AUM increase.

Founded to function as an NBFC to finance automobiles produced and sold by Bajaj Auto and its affiliates, BACL is a fully-owned captive finance subsidiary. Bajaj Auto Credit Limited (BACL) recorded a net worth of Rs. 258.23 crore and a turnover of Rs. 16.65 crore on March 31, 2024.

The company’s stock dropped 10.66% during the previous year and underperformed its industry by 17.5%. Meanwhile, during the past three years, the stock has given investors gains of 108.56%. Bajaj Auto’s 1-year returns are lower than those of the sector, industry, Nifty50, and Sensex, per Trendlyne data.