Bajaj Housing Finance Gears Up for IPO: Key Details You Need to Know

Bajaj Housing Finance, a non-deposit-taking Housing Finance Company (HFC), is set to debut on the Indian stock exchanges with its upcoming IPO, anticipated to open in September, 2024. The company, which has been engaged in mortgage lending since 2018, plans to raise approximately Rs.7,000 crore through this IPO, including Rs.4,000 crore as a fresh issue and Rs.3,000 crore through an offer for sale by its parent company, Bajaj Finance.

Financial Overview & IPO Details

As of FY24, Bajaj Housing Finance reported good financials with a revenue of Rs.7,617.71 crore and a PAT of Rs.1,731.22 crore, reflecting growth compared to previous years. The company’s assets under management (AUM) stood at Rs.91,370 crore, marking a 32% year-on-year increase. 

The IPO price band is tentatively set between Rs.65 and Rs.70 per share, with a face value of Rs.10 per equity share. The IPO is a move aligned with the Reserve Bank of India’s mandate for “Upper Layer” NBFCs to list within three years of their identification. Bajaj Housing Finance was categorized as an “Upper Layer” NBFC by the RBI in September 2022.

Utilizing Proceeds & Shareholder Quota

The proceeds from the fresh issue will be utilized to strengthen the company’s capital base along with supporting its future business expansion plans. Bajaj Housing Finance IPO is expected to further boost the company’s brand name and create a public market for its equity shares in India. A portion of the funds will also be allocated for general corporate purposes.

In terms of quotas, retail investors have been allotted 35% of the offering, while qualified institutional buyers (QIBs) have been given 50%, and non-institutional investors (NIIs) have a 15% share.According to the reports, there is also a specific allocation for shareholders, with 40% of the NII quota reserved for those with company shares before the IPO, which provides an opportunity for existing shareholders to increase their stake.

Investors can apply for the IPO through the ASBA facility available in their bank accounts or via IPO forms available on the NSE and BSE websites or respective brokerage websites. The company’s promoters, Bajaj Finance Limited and Bajaj Finserv Limited, are looking at a post-IPO valuation between Rs.56,000 crore and Rs.59,000 crore.

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Conclusion: In conclusion, Bajaj Housing Finance’s IPO is marking the Bajaj Group’s return to public markets after several years. With strong financials and growth plans set, the company seems set to attract major investor interest. The listing will also fulfill regulatory requirements, positioning Bajaj Housing Finance for growth in the mortgage lending sector.

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.