Bajaj Housing Finance Ltd IPO to Hit D-Street on September 9 - Know Key Details Here
Bajaj Housing Finance Ltd, a non-deposit housing finance company (HFC), is all set to launch its initial public offering (IPO) on September 9. The IPO consists of a fresh issue and an offer for sale. Read on to learn key details of this IPO.
About Bajaj Housing Finance Ltd
Bajaj Housing Finance Ltd is a non-deposit-taking Housing Finance Company (HFC) registered with the National Housing Bank (NHB) since September 24, 2015. It's engaged in mortgage lending since fiscal 2018 and offers financial solutions tailored to individuals and corporate entities for purchasing and renovating homes and commercial spaces. The company's mortgage product suite comprises:
- Home loans
- Loan against property
- Lease rental discounting
- Developer financing
As of June 30, 2024, the company had 323,881 active customers, 83.2% of whom were home loan customers.
IPO details
Bajaj Housing Finance Ltd IPO opens on September 9 and closes on September 11. Here are other key details of the IPO:
| Particulars | Lot size, price and other details |
|---|---|
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 offer proceeds
Bajaj Housing Finance Ltd proposes utilising the fresh issue's net proceeds to augment its capital base and meet future business requirements for lending. Further, a portion of the proceeds from the fresh issue will be used to meet offer expenses.
Financial overview of Bajaj Housing Finance Ltd
As an investor, it’s crucial for you to know a company’s financial positioning before investing in its IPO. The table captures some key financials of Bajaj Housing Finance Ltd across different financial years:
| Particulars | As of March 31, 2024 | As of March 31, 2023 | As of March 31, 2022 |
|---|---|---|---|
Total equity and liabilities (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 average net worth | 15.2% | 14.6% | 11.1% |
EBITDA (in ₹ crores) | 6893.53 | 4944.78 | 3140.93 |
Company’s strengths
Some of the key strengths of Bajaj Housing Finance Ltd are:
- 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 ability to attract and retain talented employees
Industry overview
The Indian housing finance market clocked a healthy approximately 13.1% CAGR from fiscal 2019 to fiscal 2023, on account of rise in disposable incomes, healthy demand, and greater number of players entering the segment.
Over the past two fiscals, the housing finance segment has seen favourable affordability on account of stable property rates and improved annual income of individual borrowers. Going forward, CRISIL Market Intelligence &Analytics expects the overall housing segment to grow at a CAGR of 13-15% from fiscal 2024 to fiscal 2027.
In conclusion
One will have to wait and watch to gauge investors’ response to the IPO. Before applying for the IPO, do thorough homework and make sure it aligns with your overall financial goals and risk tolerance. Read the company’s red herring prospectus for a complete overview.
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.
