Bajaj Housing Finance IPO Aims to Raise Rs 7,000 Crore for Capital Expansion
Bajaj Housing Finance has submitted its Draft Red Herring Prospectus to raise Rs 7,000 crore through an IPO, focusing on capital expansion and meeting financial needs.
Bajaj Housing FinanceIpoCapital ExpansionHousing FinanceBajaj FinanceBajaj FinservReal Estate NewsJun 15, 2024
The Pune-based company aims to bolster its capital base with the proceeds, primarily to meet ongoing financial needs and future business requirements for onward lending. Bajaj Finance, which fully owns Bajaj Housing Finance, is set to divest approximately Rs 3,000 crore in its housing finance division through the offer for sale. The net proceeds from the fresh issue will be utilized to enhance the company's capital base, ensuring sufficient funds for its business growth and lending activities.
As of March 31, 2024, home loans comprised 57.8% of Bajaj Housing Finance's total assets under management (AUM), down from 61.7% the previous year. The company has reserved portions of the IPO for specific qualified shareholders of Bajaj Finance Limited and Bajaj Finserv Limited, as well as eligible employees of Bajaj Housing Finance Limited (BHFL), Bajaj Finance Limited, and Bajaj Finserv Limited.
Bajaj Housing Finance offers a comprehensive range of mortgage solutions, including home loans, secured loans against property, and lease rental discounts. Additionally, it provides inventory finance and construction finance for developers. For the financial year 2023-24, BHFL reported a net profit of Rs 1,731 crore, marking a 38% year-on-year increase.
As of March 31, 2024, Bajaj Housing Finance's capital adequacy ratio, including Tier II capital, stood at 21.28%, reflecting the company's robust financial health. This IPO marks a significant step for Bajaj Housing Finance as it seeks to expand its financial capabilities and support its ongoing and future business ventures.
Information Bajaj Housing Finance is a subsidiary of Bajaj Finserv, a diversified financial services company with interests in life insurance, general insurance, and asset management, among others. Bajaj Finance, which holds a 51.34% stake in Bajaj Finserv, is a leading non-banking financial company (NBFC) with a strong presence in the Indian financial market.
Frequently Asked Questions
What is the amount that Bajaj Housing Finance aims to raise through its IPO?
Rs 7,000 crore
What is the composition of the IPO?
The IPO will include an offer for sale (OFS) by Bajaj Finance of equity shares worth Rs 3,000 crore, along with a new issue of equity shares amounting to Rs 4,000 crore.
What is the primary objective of the IPO?
To bolster the company's capital base and meet ongoing financial needs and future business requirements for onward lending.
What is the capital adequacy ratio of Bajaj Housing Finance as of March 31, 2024?
21.28%, including Tier II capital
What is the net profit reported by Bajaj Housing Finance for the financial year 2023-24?
Rs 1,731 crore, marking a 38% year-on-year increase
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