Bajaj Housing Finance has announced that it has already raised Rs 1,758 crore from anchor investors during the bidding that concluded on Friday, September 6, 2024.
Adding to the buzz, the shares of Bajaj Housing Finance are commanding a strong premium in the grey market on the first day of its opening. Sources tracking grey market activities reveal that Bajaj Housing Finance shares are trading at a grey market premium (GMP) of Rs 56.70, or 81 per cent, reflecting favourable market sentiment for the Bajaj Housing Finance IPO.
As the Bajaj Housing Finance IPO opens for public subscription today, brokerages, including Deven Chokshi Research, and Swastika Investmart, have shared their views on the IPO for investors. Before delving into the brokerages’ calls, let’s review the key details of the Bajaj Housing Finance public issue.
Bajaj Housing Finance IPO details
At the upper end, the company seeks to raise Rs 6,560 crore from the issue, offering a fresh issue of 937,142,858 shares worth around Rs 6,560 crore, as well as an offer for sale with Bajaj Finance, the promoter of the company, offloading up to 508,571,429 shares with a face value of Rs 10 apiece.
The public issue of Bajaj Housing Finance is available at a price band of Rs 66-70, with a lot size of 214 shares. Thus, investors can bid for a minimum of 214 shares and in multiples thereof. The minimum amount required to bid for the Bajaj Housing Finance IPO by retail investors is Rs 14,980.
KFin Technologies is the registrar for the Bajaj Housing Finance IPO, while Kotak Mahindra Capital, BofA Securities, Axis Capital, Goldman Sachs (India) Securities, SBI Capital Markets, JM Financial, and IIFL Securities are the book-running lead managers of the public issue.
Bajaj Housing Finance seeks to utilise the net proceeds from the fresh issue of the IPO towards augmenting its capital base to meet future business requirements, including onward lending. Additionally, the company expects to benefit from the listing of its equity shares on the stock exchanges, enhancing its brand name and creating a public market for its equity shares in India. A portion of the proceeds from the fresh issue will also be used to meet offer expenses, according to the RHP papers.
The three-day subscription window to bid for the Bajaj Housing Finance IPO will end on Wednesday, September 11, 2024. Following the closure of the subscription window, the basis of allotment of Bajaj Housing Finance shares is likely to take place on Thursday, September 12, 2024, and the company’s shares will be credited into demat accounts on Friday, September 13, 2024.
After the allotment, Bajaj Housing Finance shares are slated to make their debut on the bourses on Monday, September 16, 2024. Bajaj Housing Finance shares will be listed on the BSE, and NSE.
Bajaj Housing Finance IPO review
Should you subscribe to the Bajaj Housing Finance IPO?
Deven Choksey Research – Subscribe
The brokerage remains optimistic on Bajaj Housing Finance’s outlook due to its substantial brand equity, strategic business expansion plans, extensive geographic coverage, and enhanced technological infrastructure through its omnichannel approach. “These factors are expected to improve operational efficiency and maintain favourable credit costs, supported by superior asset quality. Therefore, we recommend rating Bajaj Housing Finance’s IPO as ‘Subscribe’,” said the brokerage in its report.
Swastika Investmart – Subscribe for listing gains and long term
Brokerage firm Swastika Investmart, in its report, has recommended investors subscribe to the Bajaj Housing Finance IPO for both listing gains and long-term prospects. Swastika Investmart pointed out that Bajaj Housing Finance benefits from the legacy of the renowned Bajaj Group. According to the brokerage, the company has demonstrated consistent growth in both revenue and profit, with favourable financial metrics.
Swastika Investmart further stated that the valuation of Bajaj Housing Finance is reasonable. It believes there is significant anticipation and demand for the IPO. “Given the company’s strong heritage, financial performance, and market excitement, we recommend subscribing to the IPO for potential listing gains and long-term value appreciation,” said Swastika Investmart.
About Bajaj Housing Finance
Bajaj Housing Finance Ltd (BHFL), formerly known as Bajaj Financial Solutions Ltd, was incorporated as a subsidiary of Bajaj Finserv Ltd (BFS) on June 13, 2008. It is a company limited by shares and domiciled in India. It was acquired by Bajaj Finance Ltd (BFL) as a wholly-owned subsidiary from BFS on November 1, 2014, with the intent to conduct housing finance business through a dedicated subsidiary. The company’s name was changed to Bajaj Housing Finance on November 14, 2014.
Bajaj Housing Finance’s revenue from operations was reported at Rs 22,086.5 crore for the quarter ended June 30, 2024. It stood at Rs 76,173.1 crore for FY24 and Rs 56,647.3 crore for FY23. The company’s profit after tax for the period ended June 30, 2024, was Rs 4,826.1 crore, while it stood at Rs 17,312.2 crore for FY24 and Rs 12,578.3 crore for FY23. Bajaj Housing Finance’s total comprehensive income for the period ended June 30, 2024, was Rs 4,832.4 crore, while for FY24 it stood at Rs 17,303.1 crore, and Rs 12,619.5 crore for FY23.
First Published: Sep 09 2024 | 9:20 AM IST