Bajaj Housing files for Rs 7,000-crore IPO

According to the DRHP, only Bajaj Finance is participating in the offer for sale of up to Rs 3,000 crore though Bajaj Finserv is also a promoter.
Image used for representational purposes only.
Image used for representational purposes only.

MUMBAI: The Bajaj Group has field the draft red herring prospects with the market regulator Sebi for a Rs 7,000-crore primary share sale from its housing finance arm, Bajaj Housing Finance.

This is the first public issue from the Pune-based group founded in 1926 after Bajaj Fiserv, which is the parent of the issuer and also the group’s holding company of its financial services vertical, went public in May 2008 and Bajaj Finance, another promoter of the firm hit the market in 1994. Bajaj Auto has been listed since

The issue, amongst the largest from the housing finance space and the largest so far this fiscal, comprises Rs 4000-corre of fresh issue and Rs 3,000 crore of offer for sale by promoters--Bajaj Finance and Bajaj Finserv, both listed entities.

The Blackstone-backed Aadhar Housing (Rs 3,000-crore issue last month) and the Westbridge-backed India Shelter Finance (Rs 1,200 crore in December 2023) were the two IPOs from the home finance side this year.

According to the DRHP, only Bajaj Finance is participating in the offer for sale of up to Rs 3,000 crore though Bajaj Finserv is also a promoter.

The DRHP filing comes two days after the board approved the IPO this Thursday.

The company proposes to use the proceeds from the issue to augment the capital base to meet future business requirements and for onward lending.

Bajaj Housing Finance is identified as an upper layer NBFC by the RBI since September 2022 under the scale-based regulations which mandate such firms to go public within three years, that’s by this September.

Apart from Bajaj Housing, the upper layer NBFCs include Tata Sons, HDB Financial Services, Tata Capital, and Aditya Birla Finance among others

The company began operations in September 2015 as a non-deposit taking home finance player regulated by the National Housing Bank and offers home loans, loans against property, lease rental discounting, and developer financing but the focus is individual retail housing loans.

It had 215 branches as of March 2024, spread across 174 locations in 20 states and three union territories.

For the nine months to December 2023, Bajaj Housing had a loan book of Rs 85,929 crore, which was 31 percent more than the year-ago period. Net disbursements rose by 31 percent to Rs 25,308 crore, while net profit jumped 41 percent to Rs 1,350 crore.

Kotak Mahindra Capital Company, BofA Securities India, Axis Capital, Goldman Sachs India Securities, SBI Capital Markets, JM Financial and IIFL Securities are the book running lead managers to the issue.

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