Table of Contents
Introduction
The financial landscape is abuzz with the upcoming Bajaj Housing Finance IPO 2024, a significant offering that presents a lucrative opportunity for investors. With an issue size of ₹6,560.00 crores, this book-built IPO combines a fresh issue and an offer for sale, making it a compelling choice for both retail and institutional investors. This comprehensive guide delves into the intricacies of the Bajaj Housing Finance IPO 2024, providing you with all the essential information to make an informed investment decision.
Bajaj Housing Finance IPO 2024 Overview Bajaj Housing Finance Limited
Founded in 2008, Bajaj Housing Finance Limited (BHFL) is a prominent non-deposit-taking Housing Finance Company (HFC) registered with the National Housing Bank (NHB) since 2015. As part of the renowned Bajaj Group, BHFL has established itself as a leader in providing mortgage loans, offering a range of financial solutions for home and commercial space acquisitions and renovations. With a robust network of 215 branches across 174 locations in 20 states and three union territories, BHFL has been a trusted name in the housing finance sector.
IPO Details
Issue Size and Structure
The Bajaj Housing Finance IPO is a book-built issue totaling ₹6,560.00 crores, divided into:
- Fresh Issue: 50.86 crore shares aggregating to ₹3,560.00 crores
- Offer for Sale: 42.86 crore shares aggregating to ₹3,000.00 crores
Bajaj Housing Finance IPO 2024
Price Band
The IPO price band is set between ₹66 to ₹70 per share, offering investors a competitive entry point.
Lot Size and Investment Requirements
- Minimum Lot Size: 214 shares
- Minimum Investment for Retail Investors: ₹14,980
- Minimum Lot Size for sNII (Small Non-Institutional Investors): 14 lots (2,996 shares) totaling ₹209,720
- Minimum Lot Size for bNII (Big Non-Institutional Investors): 67 lots (14,338 shares) totaling ₹1,003,660
Allocation and Reservation
The IPO offers a total of 93,71,42,865 shares allocated as follows:
- QIB (Qualified Institutional Buyers): 16,74,28,580 shares (17.87%)
- NII (Non-Institutional Investors): 12,55,71,430 shares (13.4%)
- bNII > ₹10L: 8,37,14,286 shares (8.93%)
- sNII < ₹10L: 4,18,57,143 shares (4.47%)
- Retail Investors: 29,30,00,000 shares (31.27%)
- Employees: 2,85,71,428 shares (3.05%)
- Anchor Investors: 25,11,42,856 shares (26.8%)
Additionally, Rs 5,000 million worth of shares are reserved under the Shareholder Reservation Portion for eligible shareholders of Bajaj Finance Limited and Bajaj Finserv Limited as of August 30, 2024.
Step by Step Guide to Open Demat Account in Upstox
Bajaj Housing Finance IPO 2024
IPO Timeline
- IPO Bidding Opens: September 9, 2024
- IPO Bidding Closes: September 11, 2024
- Allotment Finalization: September 12, 2024
- Initiation of Refunds: September 13, 2024
- Credit of Shares to Demat: September 13, 2024
- Listing Date: September 16, 2024 (BSE and NSE)
Key Players
Book Running Lead Managers:
- 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
- IIFL Securities Ltd
Registrar:
- Kfin Technologies Limited
Financial Performance
Bajaj Housing Finance Limited has showcased robust financial growth, reflecting its strong market position.
Key Financials (Restated):
| Period Ended | 30 Jun 2024 | 31 Mar 2024 | 31 Mar 2023 | 31 Mar 2022 |
|---|---|---|---|---|
| Assets (₹ Crore) | 88,538.83 | 81,827.09 | 64,654.14 | 48,527.08 |
| Revenue (₹ Crore) | 2,208.73 | 7,617.71 | 5,665.44 | 3,767.13 |
| Profit After Tax (₹ Crore) | 482.61 | 1,731.22 | 1,257.8 | 709.62 |
| Net Worth (₹ Crore) | 14,719.91 | 12,233.5 | 10,503.19 | 6,741.36 |
| Reserves and Surplus (₹ Crore) | 4,252.83 | 5,520.81 | 3,791.03 | 1,858.03 |
| Total Borrowing (₹ Crore) | 73,347.06 | 69,129.32 | 53,745.39 | 41,492.32 |
Key Performance Indicators (KPI):
- Debt/Equity: 5.7
- Return on Net Worth (RoNW): 3.6%
- Price to Book Value (P/BV): 3.72
- Earnings Per Share (EPS):
- Pre IPO: ₹2.21
- Post IPO: ₹2.32
- Price to Earnings (P/E):
- Pre IPO: 31.62x
- Post IPO: 30.2x
Subscription Status
As of September 10, 2024, the Bajaj Housing Finance IPO 2024 has been subscribed 2.88 times, reflecting strong investor interest.
Category-wise Subscription:
| Category | Subscription (times) | Shares Offered | Shares Bid For |
|---|---|---|---|
| QIB | 1.14 | 16,74,28,580 | 19,10,32,878 |
| NII | 6.33 | 12,55,71,430 | 79,43,01,660 |
| – bNII > ₹10L | 6.44 | 8,37,14,286 | 53,91,90,976 |
| – sNII < ₹10L | 6.09 | 4,18,57,143 | 25,51,10,684 |
| Retail | 2.30 | 29,30,00,000 | 67,34,21,620 |
| Employee | 0.57 | 2,85,71,428 | 1,64,09,948 |
| Others | 4.24 | 7,14,28,571 | 30,31,42,984 |
| Total | 2.88 | 68,60,00,009 | 1,97,83,09,090 |
Total Applications Received: 2,456,734
Promoter and Shareholding Details
Pre-Issue Shareholding: 7,819,575,273 shares
Post-Issue Shareholding: 8,328,146,702 shares
Promoters: Bajaj Finance Limited and Bajaj Finserv Limited
Use of Proceeds
Bajaj Housing Finance Limited intends to utilize the net proceeds from the IPO to:
- Augment Capital Base: To meet future business requirements and support onward lending activities.
IPO Review
Dilip Davda, a renowned financial analyst, notes that Bajaj Housing Finance Limited, the housing finance arm of the Bajaj Group, leverages the group’s legacy to drive growth. As the second-largest and fastest-growing entity in its segment, BHFL has demonstrated steady growth in both top and bottom lines. Based on FY25 annualized earnings, the IPO appears fully priced, making it an attractive long-term investment. Investors are advised to consider allocating moderate funds to include BHFL as part of their diversified portfolio.
Bajaj Housing Finance IPO 2024 Subscription Status
The Bajaj Housing Finance IPO has witnessed substantial subscription levels, particularly in the NII category, indicating strong institutional interest and confidence in the company’s growth prospects.
Live Subscription Details as of September 10, 2024, 10:33:08 AM (Day 2):
- Overall Subscription: 2.88x
- Public Issue Subscription: 2.30x (Retail), 1.14x (QIB), 6.33x (NII)
IPO Timeline (Tentative Schedule)
| Event | Date |
|---|---|
| IPO Open Date | Monday, September 9, 2024 |
| IPO Close Date | Wednesday, September 11, 2024 |
| Basis of Allotment | Thursday, September 12, 2024 |
| Initiation of Refunds | Friday, September 13, 2024 |
| Credit of Shares to Demat | Friday, September 13, 2024 |
| Listing Date | Monday, September 16, 2024 |
| Cut-off time for UPI mandate confirmation | 5 PM on September 11, 2024 |
Investor Insights and Recommendations
Bajaj Housing Finance IPO 2024 presents a promising investment opportunity for several reasons:
- Strong Financial Growth: With revenue increasing by 34% and PAT rising by 38% from FY2023 to FY2024, BHFL demonstrates robust financial health.
- Market Position: As part of the esteemed Bajaj Group, BHFL benefits from a strong brand and extensive network.
- Growth Potential: The augmented capital base from the IPO will support future lending, fueling further growth.
- Subscription Demand: High subscription multiples, especially in the NII category, reflect strong investor confidence.
Investors looking for a long-term investment with a stable growth trajectory may find the Bajaj Housing Finance IPO an attractive addition to their portfolios.
Conclusion
The Bajaj Housing Finance IPO 2024 stands out as a robust investment opportunity, underpinned by the company’s strong financial performance, expansive network, and strategic growth plans. With a well-structured issue size, competitive price band, and significant subscription levels, the IPO has garnered substantial interest from both retail and institutional investors. As Bajaj Housing Finance continues to leverage its legacy and expand its footprint, the IPO offers a promising avenue for investors seeking long-term value and stability in the housing finance sector.
For more detailed information, refer to the Bajaj Housing Finance IPO 2024 Red Herring Prospectus (RHP).
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Investors should conduct their own research or consult with a financial advisor before making investment decisions.
FAQ
1. What is the total issue size of the Bajaj Housing Finance IPO 2024?
The total issue size is ₹6,560.00 crores, comprising a fresh issue of ₹3,560.00 crores and an offer for sale of ₹3,000.00 crores.
2. When is the listing date for the IPO?
The IPO is expected to list on BSE and NSE on Monday, September 16, 2024.
3.What is the price band for the IPO?
The price band is set between ₹66 to ₹70 per share.
4. Who are the lead managers for the IPO?
The lead managers include 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 Ltd.
5. What is the minimum investment required for retail investors?
Retail investors need to invest a minimum of ₹14,980, corresponding to 214 shares.
6. How can existing shareholders participate in the IPO?
Eligible shareholders of Bajaj Finance Limited and Bajaj Finserv Limited as of August 30, 2024, can apply for the IPO under the Shareholder Reservation Portion.
7.What is the face value of Bajaj Housing Finance IPO shares?
The face value of each share is ₹10 per share.
8.What is the minimum and maximum investment amount for sNII (Small Non-Institutional Investors)?
For sNII (small HNIs), the minimum investment is ₹209,720 for 14 lots (2,996 shares). The maximum investment is ₹988,680 for 66 lots (14,124 shares).
9.What is the minimum and maximum investment amount for bNII (Big Non-Institutional Investors)?
For bNII (big HNIs), the minimum investment is ₹1,003,660 for 67 lots (14,338 shares). There is no upper limit for the maximum investment in the bNII category.
10.How many shares are being offered to retail investors in Bajaj Housing Finance IPO?
Retail investors are being offered 29,30,00,000 shares, which accounts for 31.27% of the total shares offered in the IPO.
11.Can existing employees of Bajaj Housing Finance participate in the IPO?
Yes, 2,85,71,428 shares (3.05%) have been reserved for the employees of Bajaj Housing Finance Limited.
12.What happens if the Bajaj Housing Finance IPO 2024 is oversubscribed?
In the event of oversubscription, the allotment will be decided through a lottery system for retail investors, as per SEBI guidelines. For other categories, the allotment is usually proportional based on demand.
13.What is the lock-in period for anchor investors in Bajaj Housing Finance IPO?
Anchor investors have a 30-day lock-in period for 50% of their shares, ending on October 12, 2024, and a 90-day lock-in period for the remaining shares, ending on December 11, 2024.
14.What is the expected market capitalization of Bajaj Housing Finance post-IPO?
The expected market capitalization post-IPO is approximately ₹58,297.03 crores.
15.What is the objective of the Bajaj Housing Finance IPO?
The primary objective is to augment the capital base to meet future business requirements and support onward lending for the company.
16.How can I check the Bajaj Housing Finance IPO allotment status?
You can check the allotment status by visiting the official website of the IPO registrar, Kfin Technologies Limited, or on various financial platforms that provide IPO allotment updates. The status will be available after the allotment date, which is expected on September 12, 2024.
17.When will the refund process begin if I don’t receive an allotment?
If you do not receive an allotment, the refund initiation is scheduled for September 13, 2024.
18.What are the listing exchanges for Bajaj Housing Finance IPO?
The shares of Bajaj Housing Finance will be listed on both BSE (Bombay Stock Exchange) and NSE (National Stock Exchange).
19.Can I apply for Bajaj Housing Finance IPO through UPI?
Yes, you can apply for the IPO using UPI (Unified Payments Interface). Ensure to confirm your UPI mandate by 5 PM on the IPO closing day, September 11, 2024, to validate your bid.
20.Is Bajaj Housing Finance IPO suitable for long-term investment?
Bajaj Housing Finance has demonstrated consistent financial growth, making it a potentially strong long-term investment, particularly for investors looking to add a stable financial institution to their portfolio.
21.What is the estimated EPS and P/E ratio post-IPO?
The estimated Post-IPO EPS is ₹2.32, and the P/E ratio is 30.2x. This valuation reflects the company’s solid earnings potential.
22.How does Bajaj Housing Finance compare with its peers in the housing finance sector?
Bajaj Housing Finance is among the fastest-growing housing finance companies. It competes with other major players like HDFC, LIC Housing Finance, and PNB Housing Finance. It has shown a strong performance in terms of revenue and profit growth, positioning it as a competitive player in the market.
23.Are there any risks associated with investing in Bajaj Housing Finance IPO?
As with any investment, there are risks involved. Key risks include fluctuations in interest rates, competition from other housing finance companies, and changes in regulatory policies. Investors should carefully consider these factors before investing.
24.Can NRIs (Non-Resident Indians) apply for the Bajaj Housing Finance IPO?
Yes, Non-Resident Indians (NRIs) are eligible to apply for the Bajaj Housing Finance IPO, subject to the rules and regulations outlined in the Red Herring Prospectus (RHP).
25.What is the role of book running lead managers (BRLMs) in the Bajaj Housing Finance IPO?
The book running lead managers, including Kotak Mahindra Capital, Bofa Securities India, Axis Capital, and others, are responsible for managing the IPO process, including underwriting, marketing, and ensuring regulatory compliance.
