Bajaj Finance, a major financial services provider in India, showcases a promising investment setup supported by both technical and fundamental strengths.
Technical Reasons:
Trend Line Support: The stock is holding above a long-term trend line, indicating resilience and potential for an upward move.
Intact Trend: Continuous higher highs and higher lows signal that the bullish trend remains intact.
Doji and Inside Candle Pattern on Weekly: This pattern suggests a possible reversal or continuation, highlighting a period of consolidation with potential for breakout.
Fundamental Reasons:
Record Revenue and Net Profit: Both metrics are at all-time highs, underscoring the company's financial strength.
Attractive Valuation: With a current 10-year PE ratio of 27.9, Bajaj Finance trades below its 10-year median PE of 45.4, suggesting it is undervalued relative to historical standards.
Solid Growth and Returns: The company boasts a 24% compounded sales growth rate, an ROCE of 11.9%, and an ROE of 22.1%, reflecting effective utilization of capital and profitability.
These combined factors make Bajaj Finance an attractive long-term investment option, with technical support for entry and solid fundamentals for sustained growth potential.