Bajaj Housing Finance Eyes $1 Billion IPO Amidst Market Anticipation

Bajaj Housing Finance Ltd., a subsidiary of Bajaj Finance Ltd., is gearing up for its maiden initial public offering (IPO), according to insider sources. While discussions are still in the early stages, multiple investment banks are reportedly vying for the mandate, as shared by sources preferring anonymity. The company is eyeing a valuation of approximately $10 billion and intends to raise around $1 billion through the IPO.

Bajaj Housing Finance

If all goes according to plan, the mortgage lender aims to make its debut on the stock exchanges by late 2024 or early 2025. This strategic move aligns with compliance requirements set by the Reserve Bank of India (RBI) under its scale-based regulations. Notably, upper-layer non-banking financial companies (NBFCs) are mandated to list on exchanges within three years of notification. Bajaj Housing Finance, identified among the 16 upper-layer NBFCs by the RBI in September 2022, is expected to adhere to the regulator’s norms by listing before 2025.

Previous reports hinted at Bajaj Housing Finance seeking an extension from the RBI regarding its listing timeline. This request was reportedly driven by the company’s relatively young age, as a minimum 10-year track record is typically required for listing. Queries directed to Bajaj Finance remained unanswered at the time of this report’s publication. Financial indicators underscore a robust performance by Bajaj Housing Finance, with assets under management witnessing a 31% year-on-year surge to reach Rs 85,929 crore as of December 31. Disbursements also displayed an impressive uptick, soaring 44% year-on-year to Rs 10,727 crore.

In the fiscal third quarter of 2024, the lender reported a 17% year-on-year rise in net interest income to Rs 645 crore. Similarly, net total income surged by 17% to Rs 746 crore compared to the previous year. Profit after tax (PAT) witnessed a substantial increase of 31% year-on-year, reaching Rs 437 crore, up from Rs 334 crore in the corresponding period of FY23.

Bajaj Housing Finance has established a broad presence across 186 locations, showcasing its extensive reach in serving customers. The company takes pride in its diverse portfolio, offering a range of financial products including home loans, loans against property, and lease rental discounting, noteworthy is the fact that home loans form the cornerstone of its portfolio, representing the majority share at 56%. This underscores the company’s commitment to meeting the housing needs of individuals and families, while also catering to other financial requirements through its array of offerings.

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