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Bajaj Housing Finance, a subsidiary of Bajaj Finance, has filed a Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (Sebi) to raise about Rs 7,000 crore through an initial public offering (IPO).
The offer comprises a fresh issue of equity shares of up to Rs 4,000 crore and an offer for sale (OFS) of up to Rs 3,000 crore with the face value of Rs 10 each equity share by the promoter entity - Bajaj Finance Limited.
The announcement comes a day after the board of Bajaj Housing Finance approved the company's listing plans subject to market conditions to fulfil regulatory requirements. Its parent company Bajaj Finance disclosed that it would sell shares worth Rs 3,000 crore in the housing finance subsidiary.
Bajaj Housing Finance is a 100 per cent subsidiary of Bajaj Finance.
The Housing Finance company aims to use the net proceeds to augment its capital base to meet future business requirements of the company towards onward lending.
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In September 2022, the Reserve Bank of India (RBI) released a list of 15 NBFCs that are in the upper layer as their loan book was above Rs 50,000 crore. The central bank norms mandated the company to list its shares on the exchanges by September 2025.
The lead book-running managers to the issue are 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 Limited.
The company posted 38 per cent year-on-year (Y-o-Y) growth in net profit to Rs 1,731 crore in FY24. The capital adequacy ratio (including Tier-II capital) was 21.28 per cent as of March 31, 2024.
The company offers a full range of mortgage products, such as home loans, loans against property, and lease rental discounts, to salaried and self-employed customers. It also offers construction finance and inventory finance to developers.
Home loans were 57.8 per cent of the total assets under management (AUM) as of March 31, 2024, compared to 61.7 per cent a year ago.
