Bajaj Housing Finance IPO Opens Today: Offers 70% Listing Gains, Check GMP and Details
Bajaj Housing Finance Limited (BHFL), a subsidiary of Bajaj Finance and Bajaj Finserv, has opened its highly anticipated initial public offering (IPO) today, September 9, 2024. The IPO aims to raise ₹6,560 crore through a combination of fresh equity sales and an offer for sale (OFS).
The price band for the IPO has been set at ₹66 to ₹70 per share, with a minimum lot size of 214 shares. Retail investors can apply for a minimum of one lot, requiring an investment of at least ₹14,980. The IPO will remain open for subscription until September 11, 2024.
Main Points
Bajaj Housing Finance IPO Highlights
- Issue Size: ₹6,560 crore
- Fresh Issue: ₹3,560 crore
- Offer for Sale: ₹3,000 crore
- Price Band: ₹66 to ₹70 per share
- Minimum Lot Size: 214 shares
- Minimum Investment for Retail: ₹14,980
- Listing Date: September 16, 2024 (tentative)
Ahead of the IPO, Bajaj Housing Finance has secured ₹1,758 crore from anchor investors, allotting shares at the upper end of the price band, ₹70 per share. The anchor investors include prominent names like the Government of Singapore, ADIA, Fidelity, Invesco, HSBC, Morgan Stanley, Nomura, and JP Morgan. The net proceeds from the IPO will be used to bolster the company’s capital base and support future business expansion, particularly in onward lending.
Bajaj Housing Finance: A Promising Housing Finance Company
Bajaj Housing Finance, a non-deposit-taking Housing Finance Company (HFC) registered with the National Housing Bank, offers tailored financial solutions for purchasing and renovating residential and commercial properties. The company primarily focuses on individual retail housing loans, supported by a diverse range of commercial and developer loans.
As of March 31, 2024, Bajaj Housing Finance had an assets under management (AUM) of ₹913,704 million, showcasing a compound annual growth rate (CAGR) of 30.9% from Fiscal 2022 to 2024. The company serves 308,693 active customers, 81.7% of whom are home loan customers.
Industry Outlook and Competitive Positioning
India’s total housing loans reached ₹28.73 trillion by March 2023, indicating a significant market opportunity against a projected housing shortage of 100 million units. The prime housing finance market in India grew to ₹9.3 trillion by Fiscal 2023, with a robust CAGR of 19.5% from 2019, outpacing the broader market’s growth.
Bajaj Housing Finance holds the highest credit ratings in India for borrowing and maintains the lowest delinquency rates among large housing finance companies. The company’s comprehensive mortgage products, focus on prime housing, and experienced management team position it well to capitalize on the growing housing finance market.
Valuation and Listing Gains
Ahead of the IPO, Bajaj Housing Finance is commanding a grey market premium (GMP) of ₹50-51 per share in the unregulated market. This suggests potential listing gains of around 70% for investors, with the stock expected to list at around ₹120-121 per share.
The company’s market capitalization is estimated at ₹58,297.03 crore based on the upper end of the price band and the post-issue equity share capital. The IPO is expected to provide an attractive opportunity for investors to participate in the growth story of Bajaj Housing Finance.
Note: The information given in this article is from investment experts and brokerage companies, they do not represent Local Haryana. Before taking any investment related decision, you must consult a certified expert.
