Bajaj Housing Finance IPO will open on September 9: Company will raise ₹6,560 crore, price band will be announced on September 3

The date of the Initial Public Offering (IPO) of Bajaj Housing Finance Limited, a subsidiary of Bajaj Finance, has been revealed. This public issue will open for subscription on September 9 and close on September 11.

The company has given this information in its Red Herring Prospectus (RHP). The size of this IPO will be Rs 6,560 crore. New shares worth Rs 3,560 will be issued in it. Also, there will be an Offer for Sale (OFS) of Rs 3,000 crore.

Price band details will be released on September 3
According to the RHP filing, the details of the price band will be released on September 3. Anchor investors will be able to bid in the IPO on September 6. SEBI had approved the company’s IPO in early August.

Kotak Mahindra Capital Company, BofA Securities India, Axis Capital, JM Financial, IIFL Securities, Goldman Sachs India Securities and SBI Capital Markets are the book-running lead managers for this IPO. Cyril Amarchand Mangaldas is the legal advisor. KFin Technologies is the registrar.

The company had filed DRHP in June
Earlier in June, Bajaj Housing Finance had filed Draft Red Herring Prospectus (DRHP) i.e. papers with the Securities and Exchange Board of India (SEBI) to bring IPO.

Then the company had said that it wants to raise Rs 7,000 crore through this IPO. According to the company’s DRHP, Bajaj Housing Finance’s proposed IPO will have a fresh issue of equity shares worth up to Rs 4,000 crore.

Apart from this, parent company Bajaj Finance will sell equity shares worth Rs 3,000 crore of its Bajaj Housing Finance through Offer for Sale (OFS).

The company will meet its capital requirements from the fund
The company will use the funds raised from the fresh issue to meet future capital requirements by increasing its capital base. Bajaj Housing Finance is selling its shares to comply with the rules of the Reserve Bank of India (RBI).

NBFCs must be listed on stock exchanges
As per RBI rules, upper-layer non-banking finance companies are required to be listed on the stock exchanges by September 2025.

This is why Aadhar Housing Finance and India Shelter Finance have been listed on the stock exchanges some time back. Bajaj Housing Finance is a non-deposit taking housing finance company registered with the National Housing Bank since September 2015.

The company provides financial solutions
It provides financial solutions for purchasing and renovating residential and commercial properties.

Bajaj Finance included in the category of upper-layer NBFC
RBI has classified Bajaj Finance as an upper-layer NBFC. It offers a range of mortgage products including home loans, loan against property, lease rental discounting and developer financing.

Bajaj Housing Finance’s assets and management figure stood at Rs 91,370 crore in FY 2024. Its net profit grew 5% year-on-year to Rs 483 crore in the first quarter of the current financial year 2024-25, April-June 2024.

The housing lender reported a net profit of Rs 1,731 crore for FY24, up 38% from Rs 1,258 crore in FY23. On June 6, the board of Bajaj Finance approved the sale of shares worth Rs 3,000 crore in the IPO of Bajaj Housing Finance.

RBI announced the list of NBFCs in September
On September 14, RBI announced the list of Non-Banking Finance Companies (NBFCs) for the year 2023-24. RBI had included 15 companies in the list of this upper layer NBFCs under scale based regulation.

LIC Housing Finance is at the top in this list. Bajaj Finance is at the second place, Shriram Finance at the third and Tata Sons Private Limited at the fourth place.

In view of the increasing size of the NBFCs sector and the increasing impact of the associated risks on other sectors, the Reserve Bank had issued new rules for NBFCs from October 2022. In this, 4 categories of NBFCs have been created according to size and business.

The purpose of the category is to increase the rules required for the company as it expands. In simple words, the rules for NBFCs-Upper Layer are almost the same as those given for banks.

According to the rules, the top 10 NBFCs of the country remain in this list and apart from these, the Reserve Bank can include any other company in it if it wants.