Bajaj Housing Finance IPO: Comprehensive Details
Bajaj Housing Finance, a prominent player in the Indian housing finance sector, is gearing up for its Initial Public Offering (IPO) with a substantial share offering. The IPO is structured to include a fresh issue of equity shares worth up to ₹3,560 crore and an offer for sale (OFS) of equity shares amounting to ₹3,000 crore by its parent company, Bajaj Finance. This dual-component IPO aims to raise a total of ₹6,560 crore, marking a significant milestone for the company as it seeks to expand its capital base and meet regulatory requirements.
Bajaj Housing Finance IPO Structure
The price band for Bajaj Housing Finance’s IPO has been set between ₹66 and ₹70 per share. The subscription period is scheduled from September 9 to September 11, 2024. Investors interested in participating can place bids for a minimum of 214 equity shares, with additional shares available in multiples of 214 thereafter. This structured approach allows a wide range of investors to engage with the IPO, from retail investors to institutional buyers.
The fresh issue component of the IPO, totaling up to ₹3,560 crore, is designed to bolster Bajaj Housing Finance’s capital base. This increase in capital is crucial for the company to support its future growth and operational requirements. The funds raised through this fresh issue will be allocated to various initiatives aimed at expanding the company’s market presence and enhancing its financial stability.
The OFS component, amounting to ₹3,000 crore, involves the sale of equity shares by Bajaj Finance, the parent company. This component of the IPO allows Bajaj Finance to monetize its investment in Bajaj Housing Finance while providing liquidity to the market. The proceeds from the OFS will not impact Bajaj Housing Finance’s capital base but will contribute to the overall funding structure of the IPO.
Allocation and Reservation Details
The allocation of shares in the Bajaj Housing Finance IPO is carefully structured to cater to different investor categories. The IPO is divided as follows:
- 50% for Qualified Institutional Buyers (QIBs): This segment is reserved for large institutional investors who are deemed capable of making substantial investments and supporting the company’s long-term growth objectives.
- 35% for Retail Investors: This allocation is aimed at individual investors who wish to participate in the IPO and invest smaller amounts compared to institutional buyers.
- 15% for Non-Institutional Investors (NIIs): This category includes investors who fall between retail and institutional categories, often making medium-sized investments.
Additionally, Bajaj Housing Finance has reserved shares worth ₹200 crore exclusively for its employees. This gesture not only benefits the company’s workforce but also aligns their interests with the company’s growth and performance.
The allotment of shares is expected to occur on September 12, 2024, with the listing on the stock exchanges projected for September 16, 2024. The listing will mark a new phase for Bajaj Housing Finance, providing it with a platform for increased visibility and access to public capital markets.
About Bajaj Housing Finance
Bajaj Housing Finance is a non-deposit-taking housing finance company, registered with the National Housing Bank (NHB) since 2015. It specializes in providing financial solutions for the renovation and purchase of residential and commercial properties. The company’s focus on delivering tailored financial products has positioned it as a key player in the housing finance sector.
For the financial year 2023-24, Bajaj Housing Finance reported a net profit of ₹1,731 crore, which represents a robust 38% increase from ₹1,258 crore in the previous fiscal year. This impressive growth underscores the company’s strong financial performance and its capacity to generate significant returns for its stakeholders.
Lead Managers and Advisors
The book-running lead managers for the Bajaj Housing Finance IPO are a consortium of prestigious financial institutions, including Kotak Mahindra Capital Company Ltd, BofA Securities India Ltd, Axis Capital Ltd, Goldman Sachs (India) Securities Private Ltd, SBI Capital Markets Ltd, JM Financial Ltd, and IIFL Securities Ltd. These firms will oversee the IPO process, ensuring a smooth and efficient subscription and allotment process.
Disclaimer
The views and recommendations provided herein are those of individual analysts, experts, and brokerage firms, and do not necessarily reflect the opinions of Mint. Investors are encouraged to seek advice from certified experts before making any investment decisions.
This IPO presents a significant opportunity for investors to participate in the growth story of Bajaj Housing Finance. With a well-structured offering and strong backing from its parent company, the IPO is poised to attract considerable interest from various segments of the investment community.
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