ICICI Securities has given Bajaj Finance a BUY rating with a target price of Rs 8,500.

Bajaj Finance recently decided to end its eight-year co-branded credit card partnership with RBL Bank. This move is seen as part of Bajaj Finance's strategy to exit the co-branded credit card business, which limited its role to marketing and distribution without customer ownership.

The termination of the partnership is expected to have a minimal impact on Bajaj Finance's profitability, as the fee income from the RBL co-branded card contributed only about 1% to the company's profit before tax. The monthly acquisition volumes for the RBL co-branded card were reported to be between 30,000 and 40,000, which is considered minor relative to the overall financial performance of Bajaj Finance.

The firm aims to diversify its fee income sources and reduce reliance on credit card fees, reinforcing its long-term growth strategy.