Bajaj Housing Finance Board Approves Rs 4,000 Crore Plus OFS IPO

Bajaj Housing Finance is a 100% subsidiary of Bajaj Finance Ltd. It offers finances to individuals or corporate entities for the purchase and renovation of homes or commercial spaces. Bajaj Housing Finance Ltd. enjoys the highest rating from CRISIL and India ratings, It is rated AAA/Stable and A1+ for its long-term and short-term debt program respectively.

On Thursday (June 6) its board of directors, in a meeting, approved an initial public offering (IPO) of equity shares valued at Rs.10 each. 

Bajaj Housing Finance IPO

The board of Bajaj Housing Finance on Thursday approved a proposal to float an initial public offer (IPO). The Bajaj Housing Finance IPO will comprise a fresh issuance of shares worth Rs 4,000 crore plus an offer for sale (OFS) of equity shares subject to market conditions. The company is expected to file draft documents with Sebi shortly.  In 2022, the Reserve Bank of India published a list of upper-layer Non-Banking Finance Companies, which are entities managing assets worth Rs 50,000 crore or more. Included in this list, Bajaj Housing Finance must be listed on stock exchanges by September 2025.

Recent Listing in the Housing Finance Segment

Aadhar Housing Finance, backed by Blackstone, and India Shelter Finance, backed by Westbridge, are recent market entrants in the segment. Over the last month, both firms have seen their stocks rise, with Aadhar Housing Finance’s stock increasing by 10% and India Shelter Finance’s stock by 5.21%.

Market Reaction on Bajaj Finance

The stock of Bajaj Finance the parent company of Bajaj Housing Finance is trading up by 3.5% at Rs.7170 a piece after the approval of Bajaj Housing Finance IPO, The stock is up by 4.5% in the past one month and has made a 52 week high and 52 week low of Rs.8192 a piece and Rs.6187.80 respectively. 

Conclusion

Bajaj Housing Finance’s approval of an IPO, alongside its upcoming listing obligation as an upper-layer NBFC, signals significant developments in the financial market. With plans for a substantial IPO and compliance with regulatory directives, the company aims to strengthen its market presence and offer new opportunities to investors.

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Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.