Bajaj Housing Finance Limited (BHFL), a 100% subsidiary of Bajaj Finance Limited, is classified as an ‘Upper-Layer NBFC’ by the RBI under Scale Based Regulations. With its headquarters in Pune, BHFL provides a wide range of financial services including loans for home and commercial property purchases, renovation, loans against property, working capital for business expansion, and financing for developers. BHFL is now launching its Initial Public Offering (IPO) to raise significant capital.

IPO Details and Subscription Period

The Bajaj Housing Finance IPO is a substantial issue amounting to ₹6,560.00 Crores. This includes a Fresh Issue of 50.85 Lakh Shares worth ₹3,560.00 Crores and an Offer for Sale of 42.85 Lakh Shares totaling ₹3,000.00 Crores. The subscription period for the IPO is from September 09, 2024, to September 11, 2024. The shares are expected to be listed on the BSE and NSE around September 16, 2024, with the allotment process being finalized on September 12, 2024.

Share Price Band and Lot Size

The share price band for Bajaj Housing Finance is set between ₹66 and ₹70 per share. The minimum lot size is 214 shares, requiring a retail investment of ₹14,980. High-Net-Worth Individuals (HNIs) need to invest in a minimum of 14 lots (2,996 shares), totaling ₹209,720.

Grey Market Premium

The Grey Market Premium (GMP) for Bajaj Housing Finance IPO is estimated to be in the range of ₹60 to ₹65. While GMP can provide a rough estimate of potential listing gains, it is important to note that this is not a definitive indicator of the final listing price. The GMP is influenced by market demand and supply in an unorganized manner.

Subscription Status

As of September 11, 2024, the Bajaj Housing Finance IPO has been subscribed 63.61 times on its final day of subscription. For the latest updates on the subscription status, investors can check the BSE website.

Allotment Status

The allotment status for Bajaj Housing Finance IPO will be available on September 12, 2024. Investors can check their allotment status by visiting the registrar’s website and entering their application number, PAN, or DP Client ID.

Objectives of the IPO

The proceeds from the Fresh Issue will be utilized for various corporate purposes. The Offer for Sale proceeds will go to the Promoter Selling Shareholder, after deducting relevant expenses and taxes. The company will not receive any proceeds from the Offer for Sale.

Financial Performance and Valuation

Bajaj Housing Finance has shown impressive financial growth, with revenue increasing from ₹37,671.3 Million in FY22 to ₹76,177.1 Million in FY24. EBITDA and PAT have also seen significant rises during this period. The IPO is priced with a pre-issue EPS of ₹2.6 and a post-issue EPS of ₹2.07. The pre-issue P/E ratio stands at 26.92x, while the post-issue P/E ratio is 33.81x, compared to an industry P/E ratio of 20.0x. The company’s ROAE for FY24 is 15.2%, indicating a solid financial foundation.

Investment Recommendation

The Bajaj Housing Finance IPO presents a promising opportunity with potential listing gains estimated at 90% - 95%. Given the company's strong financial performance and valuation metrics, we recommend considering the Bajaj Housing Finance IPO for both short-term gains and long-term investment.

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