InvestorQ : I am holding Bajaj Finance which I bought during the fall at around Rs.3500. Now a brokerage downgrades target to Rs.1700. What should I do?
Dawn Cherian made post

I am holding Bajaj Finance which I bought during the fall at around Rs.3500. Now a brokerage downgrades target to Rs.1700. What should I do?

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Dilmini Mercia answered.
7 months ago
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I think you are referring to the Bernstein report which recently downgraded the target price of Bajaj Finance to Rs.1700. Since you have bought the stock at Rs.3500, you are still sitting on losses at Rs.2700. The stock has already corrected more than 50% and that more than compensates for the loss of business during the lockdown phase. Yes, there is going to be some strain on repayments but I think Bajaj Finance has a very strong loan recovery policy which has helped them keep NPAs very low in a tough business. It is hard to say how low the price will go but if you get the stock at Rs.1700, I would go in and buy more of the stock. Bajaj Finance still remains the best proxy for the India growth story and the Indian consumer demand so you should not worry about selling out right now. Like most high quality stocks, this stock will also bounce back when the economy recovers.

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