Bajaj Housing Finance Shares End At 135% Premium Over IPO Price

Shares of Bajaj Housing Finance Ltd. closed on the BSE on Monday at Rs 165 apiece, a premium of 135.7% over its issue price of Rs 70 per share. Even on the National Stock Exchange, the stock ended at Rs 165 per share.

The non-banking financial company's shares listed on the BSE and the NSE at a premium of 114% over its issue price.

The wholly owned subsidiary of Bajaj Finance Ltd. became the hottest initial public offering of the year as it garnered subscriptions worth Rs 3.23 lakh crore for its Rs 6,560 crore issue.

Bajaj Housing Finance will continue to grow consistently, given the steady growth in the housing finance industry, aided by tailwinds of economic growth, Sanjiv Bajaj, managing director, Bajaj Finserv Ltd., told reporters after the listing event.

Shareholders should expect a business that grows with high quality and a high level of corporate governance, Bajaj said. "Affordable housing demand is going to be stronger in coming years." The NBFC's growth is stronger because of its book mix, technology and management focus on quality, he said.

The IPO of the non-banking financial company was subscribed to 63.61 times on its final day. Institutional investors drove the demand, with bids exceeding 200 times the shares set aside for them.

The three-day offer entailed a fresh issue of equity shares worth Rs 3,560 crore and an offer for sale worth Rs 3,000 crore from its owner, Bajaj Finance Ltd.

BHFL will use the proceeds from the public offer to augment the company's capital base to meet future business requirements and onward lending.

The IPO was subscribed 63.61 times on its final day.

• Institutional investors: 209.36 times.

• Non-institutional investors: 41.51 times.

• Retail investors: 7.04 times.

• Employee reserved: 2.05 times.

• Reservation portion shareholder: 17.53 times.

Bajaj Housing primarily focusses on providing mortgage loans to upper-end individual homebuyers as well as large-scale developers in India. Backed by the strong parent, Bajaj Group, the housing finance company had an extensive distribution network of 215 branches, as on June 30.

The company, which commenced mortgage lending in financial year 2018, is the largest non-deposit taking HFC in terms of assets under management.

It also has the highest salaried customer mix in the home loan portfolio among large HFCs and has the lowest gross-bad-loan and net-bad-loan ratios among large HFC peers in the industry.