Bajaj Housing Finance IPO Key To Capital For Growth, Says MD Jain

Bajaj Housing Finance Ltd., a key player in India’s mortgage market, is gearing up for its initial public offering which opens for subscription next week. The primary reason for going public is to fuel the company's growth, said Managing Director Atul Jain.

“We are a growth company, and over the past six-seven years, we’ve seen significant expansion. We’ve raised funds through our parent company, but now, at our current scale, we believe it's the right time to access capital from a larger pool of investors. The primary reason for raising funds is to meet our growth requirements.”

The IPO, slated to commence on Sept. 9, will be available at a price band of Rs 66 to 70 per share. The company is aiming to raise Rs 6,560 crore, with an upper-end valuation of approximately Rs 58,297 crore.

The company could have waited another year, but its classification as an upper-layer NBFC accelerated the decision, Jain told NDTV Profit. The management realised the company was in a good position to list early, he said.

Addressing the competitive nature of the mortgage sector, Jain said, mortgage is the largest retail asset class globally. Although the space is highly competitive and partially commoditised, Bajaj Housing Finance is optimistic, according to the top executive.

Valuations have been set by the company's book running lead managers, and future growth potential is a key factor in these valuations. The company is present in all segments of the mortgage market, with a focus on salaried individuals but operating across various segments, Jain said.

The company's extensive franchise helps push growth by reaching out to a broad customer base. Its portfolio is diverse, with a significant portion focused on salaried individuals, but the company is actively involved in all market segments, he said.

“Affordable housing is a significant growth area due to the increasing demand for home loans in this segment. While our focus has traditionally been on the salaried segment, we are actively participating in the affordable housing space. We plan to balance our portfolio to cater to all segments, including affordable housing, though the pace of growth may vary.”

The IPO will include a fresh issue of Rs 3,560 crore worth of shares and an offer for sale of Rs 3,000 crore worth of share from its parent company, Bajaj Finance Ltd. The bidding process for anchor investors begins on Sept. 6, and the IPO will close on Sept. 11. The minimum lot size for bidding is 214 shares, with additional bids to be made in multiples.