Bajaj Housing Finance Limited (BHFL), classified as an Upper-Layer Non-Banking Financial Company (NBFC) by the Reserve Bank of India (RBI) under Scale-Based Regulations, is a 100% subsidiary of Bajaj Finance Limited. As a part of one of India's most diversified NBFCs, BHFL caters to over 88.11 million customers across India, offering a wide range of financial products. The company's focus includes providing finance for residential and commercial properties, loans against property, and working capital for business expansion. The company is also known for offering financing solutions for property developers and lease rental discounting for developers and high-net-worth individuals.

Bajaj Housing Finance IPO Overview:

The Bajaj Housing Finance Limited Initial Public Offering (IPO) is a Book Built Issue that aims to raise ₹6,560.00 Crores. This IPO includes a Fresh Issue of 50.85 Lakh shares worth ₹3,560.00 Crores and an Offer for Sale (OFS) of 42.85 Lakh shares amounting to ₹3,000.00 Crores.

The IPO will open for subscription on September 09, 2024, and close on September 11, 2024. The shares are being offered in the price band of ₹66 to ₹70 per equity share. The minimum lot size for this IPO is 214 shares, with a minimum investment of ₹14,980 for retail investors. High-Net-Worth Individuals (HNIs) must invest in at least 14 lots (or 2,996 shares), with a total minimum investment of ₹209,720.

Shares of Bajaj Housing Finance Limited are expected to be listed on both the BSE and NSE, with the allotment finalization scheduled for September 12, 2024, and a tentative listing date of September 16, 2024. The issue is managed by leading financial institutions including Kotak Mahindra Capital Company Limited, BofA Securities India Limited, Axis Capital Limited, Goldman Sachs (India) Securities Private Limited, SBI Capital Markets Limited, JM Financial Limited, and IIFL Securities Limited. The Registrar for this IPO is KFin Technologies Limited.

Grey Market Premium (GMP) Insights:

The Grey Market Premium (GMP) for Bajaj Housing Finance Limited IPO is currently expected to range between ₹25 and ₹28, suggesting a potential listing gain of 35%-40%. However, investors are cautioned that GMP represents market speculation and is based on unorganized trading before the official listing. Although it can provide some indication of market demand, GMP should not be the sole basis for investment decisions.

Live Subscription Status:

As of 12:00 PM on September 09, 2024, the Bajaj Housing Finance Limited IPO has been subscribed 0.48 times on its first day of the subscription period. Investors can track the live subscription status on the BSE or on financial news platforms to monitor interest from various investor categories, such as retail investors, HNIs, and institutional investors.

Bajaj Housing Finance Financial Performance:

The company has displayed significant financial growth in recent years. Bajaj Housing Finance’s revenue surged from ₹37,671.3 million in FY22 to ₹76,177.1 million in FY24, reflecting a consistent growth trajectory. This increase is supported by a rise in the company’s EBITDA, which increased from ₹31,409.3 million in FY22 to ₹68,935.3 million in FY24, showing a strong capacity for operational profitability. Similarly, Profit After Tax (PAT) has increased from ₹7,096.2 million in FY22 to ₹17,312.2 million in FY24, further emphasizing the company’s robust financial performance.

In terms of valuation, Bajaj Housing Finance is issuing shares at a pre-issue Earnings Per Share (EPS) of ₹2.6 and a post-issue EPS of ₹2.07. The pre-issue Price-to-Earnings (P/E) ratio stands at 26.92x, while the post-issue P/E ratio is 33.81x. This P/E ratio is higher than the industry average of 20.0x, which indicates that the IPO is priced at a premium. However, the company's Return on Average Equity (ROAE) for FY24 stands at 15.2%, reflecting the company's ability to generate profits from its shareholders' equity. Despite the premium pricing, the financial performance justifies the valuation.

IPO Allotment and Listing Details:

Investors can check the allotment status for the Bajaj Housing Finance IPO on the registrar's website, KFin Technologies Limited, once the allotment is finalized on September 12, 2024. Here’s how to check the allotment:

Go to the IPO allotment status page.

Select Bajaj Housing Finance Limited IPO from the dropdown list.

Enter your application number, PAN, or DP Client ID.

Submit the details to view your allotment status.

The shares are expected to list on September 16, 2024, on both the BSE and NSE, providing investors the opportunity to trade the stock.

Objectives of the IPO:

The proceeds from the Offer for Sale will go to the Promoter Selling Shareholder after deducting applicable taxes and expenses. Bajaj Housing Finance Limited will not receive any proceeds from the Offer for Sale. The proceeds of the Fresh Issue, however, will be utilized for the following:

Expanding the company's loan book, especially in housing finance and developer financing.

Augmenting capital to meet future regulatory requirements and to fund business growth.

General corporate purposes.

IPO Review and Investment Recommendation:

Bajaj Housing Finance Limited has demonstrated impressive financial growth, with revenue, EBITDA, and PAT showing consistent increases. While the IPO price band suggests a premium valuation compared to the industry average, the company’s strong financials and positive return on equity metrics justify this premium.

Given the expected listing gains of 35%-40% based on the GMP, along with the company’s strong fundamentals, we recommend investors apply for the Bajaj Housing Finance Limited IPO for both listing gains and long-term investment purposes.

For further updates on similar issues and investment opportunities, explore the Best IPO to Apply Now - IPO List 2024, Latest IPO, Upcoming IPO, Recent IPO News, Live IPO GMP Today - Finance Saathi and stay informed with the Top News Headlines - Share Market News, Latest IPO News, Business News, Economy News- Finance Saathi.

Join our Trading with CA Abhay Telegram Channel for stock market trading insights and the Finance Saathi Telegram Channel for regular updates on share markets and IPOs.

Start your stock market journey by opening a free demat account with Choice Broking FinX.