Bajaj Housing Finance IPO
Bajaj Housing Finance Limited is launching its initial public offering (IPO) from September 9-11, 2024. The IPO aims to raise Rs 6,560 crore through a combination of fresh issue and offer for sale. The price band is set at Rs 66-70 per share with a lot size of 214 shares. The company, part of the Bajaj Group, provides mortgage loans and other housing finance services.
RI
by RA ALOK DAIYA SEBI Reg. INH000011468
IPO Structure and Timeline
1
IPO Opens
September 9, 2024 - The Bajaj Housing Finance IPO opens for subscription
2
IPO Closes
September 11, 2024 - Last day to apply for the IPO
3
Basis of Allotment
September 12, 2024 - Finalization of basis of allotment
4
IPO Listing
September 16, 2024 - Tentative listing date on BSE and NSE
The IPO consists of a fresh issue of 50.86 crore shares (Rs 3,560 crore) and an offer for sale of 42.86 crore shares (Rs 3,000 crore). The minimum lot size is 214 shares, requiring a minimum investment of Rs 14,980 for retail investors.
About Bajaj Housing Finance
Founded in 2008, Bajaj Housing Finance is a non-deposit-taking Housing Finance Company (HFC) registered with the National Housing Bank (NHB) since 2015. The company offers mortgage products including home loans, loan against property, rent concessions, and developer finance. As of March 31, 2024, it had 308,693 active customers, with 81.7% being home loan customers.
Housing Finance
Bajaj Housing Finance provides loans for purchasing and renovating homes and commercial spaces.
Company Operations
The company operates through a network of 215 branches across 20 states and 3 union territories in India.
IPO Reservation and Subscription Details
The company has also reserved Rs 5000 million worth of shares under a shareholder quota for eligible shareholders of Bajaj Finance Limited and Bajaj Finserv Limited as of August 30, 2024.
Financial Performance
Revenue Growth
Bajaj Housing Finance's revenue increased by 34% between the financial years ending March 31, 2023 and March 31, 2024.
Profit Growth
The company's profit after tax (PAT) rose by 38% during the same period.
Key Financials (as of June 30, 2024)
Total Assets: Rs 88,538.83 crore Revenue: Rs 2,208.73 crore Profit After Tax: Rs 482.61 crore Net Worth: Rs 14,719.91 crore
IPO Objectives and Lead Managers
The primary objective of the Bajaj Housing Finance IPO is to augment the company's capital base to meet future business requirements for onward lending. The issue is being managed by a consortium of lead managers including:
1
Kotak Mahindra Capital Company Limited
One of India's leading investment banks with extensive experience in managing IPOs
2
Axis Capital Limited
A subsidiary of Axis Bank, offering investment banking and advisory services
3
JM Financial Limited
An established financial services group with expertise in capital markets
4
IIFL Securities Ltd
A leading financial services company with a strong presence in investment banking
IPO Recommendation and Conclusion
Analyst View
This IPO can be opted as a long-term investment, noting the company's steady growth and strong position in the housing finance sector.
Pricing
The issue appears fully priced based on FY25 annualized earnings, suggesting limited short-term gains.
Investment Strategy
Investors may consider allocating moderate funds for adding Bajaj Housing Finance to their portfolio as a long-term investment.
Market Position
As the second largest and fastest-growing entity in its segment, Bajaj Housing Finance offers exposure to India's growing housing finance market.
Investors should carefully consider their financial goals and risk tolerance before applying for the Bajaj Housing Finance IPO. While the company has shown strong growth, the IPO pricing may limit immediate upside potential.