Bajaj Housing Finance Ltd. IPO Guide: Check Issue Date, Price, Lot Size & Essential Details
India has truly become the beating heart of IPO activity in Asia, with several big-ticket stock listings in the pipeline in 2024. Bajaj Housing Finance Ltd. is one of the companies looking to get listed on exchanges and has filed papers with SEBI for the same. The IPO will mark the return of the Bajaj Group to capital markets after many years.
About Bajaj Housing Finance Ltd .
Bajaj Housing Finance Ltd. is a non-deposit-taking housing finance company (HFC) registered with the National Housing Bank since September 2015. It has been identified and categorised as an upper-layer NBFC ("NBFC-UL”) in India by the RBI since September 2022. The company offers financial solutions tailored to individuals and corporate entities for purchasing and renovating homes and commercial spaces. Its mortgage product suite comprises:
- Home loans
- Loans against property
- Lease rental discounting
- Developer financing
As of March 31, 2024, the company was a leading HFC in India on multiple parameters. The company had 308,693 active customers and a network of 215 branches spread across 174 locations in 20 states and three union territories (as of March 31, 2024).
IPO details
Bajaj Housing Finance Ltd. IPO consists of a fresh issue and an offer for sale. Here are the key IPO details you need to know as an investor:
| Particulars | IPO Details |
|---|---|
IPO opens on | Sept 09, 2024 |
IPO closes on | Sept 11, 2024 |
Fresh issue size | ₹3560 crores |
Offer for sale size | ₹3000 crores |
Total issue size | ₹6560 crores |
Face value | ₹10 |
IPO registrar | KFin Technologies Ltd. |
Book running lead managers | Kotak Mahindra Capital Company Ltd. BofA Securities India Ltd. Axis Capital Ltd. Goldman Sachs (India) Securities Pvt. Ltd. SBI Capital Markets Ltd. JM Financial Ltd. IIFL Securities Ltd. |
Use of IPO proceeds
Bajaj Housing Finance Ltd. proposes to use the net proceeds to augment its capital base to meet future business requirements for onward lending. A portion of the proceeds will also be used to meet offer expenses.
Financial performance
The table captures key some key financials of the company which will help you understand its financial positioning:
| Particulars | FY 23-24 | FY 22-23 | FY 21-22 |
|---|---|---|---|
Total financial assets (in ₹ crores) | 81612.42 | 64528.93 | 48393.32 |
Total liabilities and equity (in ₹ crores) | 81827.09 | 64654.14 | 48527.08 |
Total income (in ₹ crores) | 7617.71 | 5665.44 | 3767.13 |
Profit after tax (in ₹ crores) | 1731.22 | 1257.80 | 709.62 |
Return on net worth (RoNW) | 15.2% | 14.6% | 11.1% |
Diluted EPS in ₹ | 2.6 | 1.9 | 1.5 |
Company’s strengths
Bajaj Housing Finance Ltd. has the following strengths:
- Distinguished heritage of the “Bajaj” brand, which enjoys widespread recognition as a reliable retail brand with strong brand equity
- Second largest HFC in India (in terms of AUM) with a track record of strong growth driven by a diversified portfolio
- Strategic presence with omni-channel sourcing strategy, driven by customer-focused digitisation initiatives and technology
- Well-defined credit evaluation and risk management practices resulting in the lowest GNPA and NNPA among peers in Fiscal 2024
- Access to diversified and cost-effective borrowing sources facilitated by the highest possible credit ratings from rating agencies
- Experienced management team supported by a team of dedicated professionals and the ability to attract and retain talented employees
Business strategies
Going forward Bajaj Housing Finance Ltd. has the following business strategies:
- Continue to leverage technology and analytics to enhance productivity, reduce expenses, improve customer experience and manage risks
- Diversifying and strengthening market presence with strategic customer focus and comprehensive risk management
- Continue to diversify its borrowing profile to optimise borrowings costs
- Continue to attract, train, and retain talented employees
Industry overview
The Indian housing finance market clocked a healthy CAGR of approximately 12.6% from fiscal 2019 to fiscal 2023, on account of a rise in disposable incomes, healthy demand, and a greater number of players entering the segment. The overall housing finance segment credit outstanding was approximately ₹28.7 trillion as of fiscal 2023. Going forward, CRISIL MI&A expects the overall housing segment to grow at a CAGR of 13-15% from fiscal 2023 to fiscal 2027.
In conclusion
Go through the company’s red herring prospectus for a complete overview of the IPO. Equally essential is understanding your financial positioning, goals, and risk tolerance before subscribing.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. It is not produced by the desk of the Kotak Securities Research Team, nor is it a report published by the Kotak Securities Research Team. The information presented is compiled from several secondary sources available on the internet and may change over time. Investors should conduct their own research and consult with financial professionals before making any investment decisions. Read the full disclaimer here.
Investments in securities market are subject to market risks, read all the related documents carefully before investing. Please read the SEBI prescribed Combined Risk Disclosure Document prior to investing. Brokerage will not exceed SEBI prescribed limit.
