Bajaj Housing Finance IPO Lists at ₹150, Surges 114.29% Over Issue Price

Bajaj Housing Finance, a non-deposit-taking housing finance company, made a stellar debut on the Indian stock market on Monday, 16th September 2024, with its shares listing at a significant premium to the issue price. The company's initial public offering (IPO) had generated robust demand from investors during its subscription period, setting the stage for an impressive market debut.

Listing Details

• Listing Price: Bajaj Housing Finance shares were listed at ₹150 per share on both the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE), marking a strong start to its journey as a publicly traded company.
• Comparison to Issue Price: The listing price represents a substantial premium over the IPO issue price. Bajaj Housing Finance had set its IPO price band from ₹66 to ₹70 per share, with the final issue price being fixed at the upper end of ₹70.
• Percentage Change: The listing price of ₹150 on both exchanges translates to a premium of 114.29% over the issue price of ₹70.

First-Day Trading Performance

• Opening vs. Latest Price: Following its strong opening at ₹150, Bajaj Housing Finance's share price continued to gain. By 11:23 AM, the stock was trading at ₹158.91, up 5.94% from its opening price.
• Market Capitalisation: As of 11:23 AM, the company's market capitalisation stood at ₹1,32,342.58 crore.
• Trading Volume: The traded volume was 5,153.07 lakh shares with a traded value of ₹7,998.08 crore, indicating significant investor interest on the first day of listing.

Market Sentiment and Analysis

• Market Reaction: The market reacted overwhelmingly positively to Bajaj Housing Finance's listing. The strong listing premium indicates robust demand and investor confidence in the company's prospects.
• Subscription Rate: The IPO was oversubscribed by 67.43 times, with QIBs leading at 222.05 times subscription.
• Grey Market Premium: Prior to listing, shares were trading at a premium of ₹75 in the grey market, suggesting an expected listing gain of 107.14% that was surpassed at listing.

Growth Drivers and Challenges 

Expected drivers of future performance:

• Strong parentage of the Bajaj Group
• Robust growth in Assets Under Management (AUM)
• Expanding presence in the housing finance sector

Potential challenges:

• Competition in the housing finance industry
• Regulatory changes affecting NBFCs
• Economic fluctuations impacting the real estate sector

Utilisation of IPO Proceeds 

Bajaj Housing Finance plans to use the funds for:

• Augmenting capital base to meet future business requirements for onward lending

Financial Performance 

The company has demonstrated strong financial growth:

• Revenue increased by 34% to ₹7,617.71 crore in FY2024 from ₹5,665.44 crore in FY2023
• Profit After Tax (PAT) rose by 38% to ₹1,731.22 crore in FY2024 from ₹1,257.8 crore in FY2023

As Bajaj Housing Finance begins its journey as a listed entity, market participants will closely monitor its ability to leverage its strong parentage and position in the housing finance sector to drive future growth and shareholder value. The stellar listing and overwhelming subscription rates suggest extremely positive market sentiment towards the company's prospects in the rapidly growing housing finance industry.