Bajaj Housing Finance Limited (BHFL), part of the Bajaj Group (with Bajaj Finance Limited and Bajaj Finserv Limited as promoters), has filed a Draft Red Herring Prospectus (DRHP) with SEBI for an Initial Public Offering (IPO). BHFL is a non-deposit taking Housing Finance Company (HFC), registered with the National Housing Bank (NHB) since September 24, 2015, and has been engaged in mortgage lending since the 2018 fiscal year.
The public offer, aggregating up to ₹7,000 crore, comprises a fresh issue of equity shares worth up to ₹4,000 crore and an offer for sale (OFS) of up to ₹3,000 crore by the “Selling Shareholder” (the “Offer for Sale”) with a face value of ₹10 per equity share by Bajaj Finance Limited (the “Promoter Selling Shareholder”).
The public offer includes a reservation of equity shares for subscription by eligible employees (“Employee Reservation Portion”) and a reservation of equity shares with a face value of ₹10 each for subscription by eligible shareholders of promoters (“Shareholders Reservation Portion”), including individuals and HUFs who are public equity shareholders of the promoters.
BHFL plans to use the net proceeds to augment the company’s capital base to meet its future business requirements for onward lending.
This offer is being made under Rule 19(2)(b) of the SCRR, read with Regulation 31 of the SEBI ICDR Regulations. Not more than 50% of the net offer shall be available for allocation on a proportionate basis to Qualified Institutional Buyers (QIBs, and such portion, the “QIB Portion”). The company, in consultation with the BRLMs, may allocate up to 60% of the QIB Portion to Anchor Investors on a discretionary basis, following the SEBI ICDR Regulations (“Anchor Investor Portion”). At least one-third of this shall be available for allocation to domestic mutual funds, subject to valid bids being received from them at or above the Anchor Investor Allocation Price. Further, not less than 15% of the net offer shall be available for allocation to Non-Institutional Bidders, and not less than 35% to Retail Individual Bidders (RIBs), subject to valid bids being received at or above the offer price.
All potential bidders (except Anchor Investors) must use the Application Supported by Blocked Amount (ASBA) process, providing details of their bank accounts (including UPI ID for UPI Bidders using UPI Mechanism) where the bid amount will be blocked by SCSBs or Sponsor Banks.
The company, in consultation with the BRLMs, may consider a Pre-IPO Placement before filing the Red Herring Prospectus with the RoC.
The equity shares offered through the Red Herring Prospectus are proposed to be listed on BSE Limited (BSE) and National Stock Exchange of India Limited (NSE).
Kotak Mahindra Capital Company Limited, BofA Securities India Limited, Axis Capital Limited, Goldman Sachs (India) Securities Private Limited, SBI Capital Markets Limited, JM Financial Limited, and IIFL Securities Limited are the Book Running Lead Managers for the issue.
About Bajaj Housing Finance Limited:
BHFL, a subsidiary of Bajaj Finance Limited under the Bajaj Group (founded in 1926), has been categorized as an “Upper Layer” NBFC (NBFC-UL) by the RBI since September 30, 2022. It offers financial solutions for purchasing and renovating homes and commercial spaces. Its comprehensive mortgage product suite includes home loans, loans against property (LAP), lease rental discounting, and developer financing, with a primary focus on individual retail housing loans.
As of March 31, 2024, BHFL had a network of 215 branches across 174 locations in 20 states and three union territories, managed by six centralized hubs for retail underwriting and seven for loan processing. BHFL holds the highest possible credit ratings in India for both long-term (CRISIL AAA/stable and IND AAA/stable) and short-term (CRISIL A1+ and IND A1+) borrowing programs.
