Bajaj Housing Finance targets $9-10 billion valuation in potential IPO
Bajaj Housing Finance, a subsidiary of Bajaj Finance, has kick-started preliminary discussions with multiple investment banks for a potential initial public offering (IPO). The company aims for a valuation in the range of $9 billion to $10 billion. The strategic move is in line with the Reserve Bank of India's (RBI) regulatory norms that require 'upper layer' non-bank financial companies (NBFCs) to go public within three years of being identified.
Compliance with RBI regulations
On September 30, 2022, the RBI identified 16 'upper layer' NBFCs under its scale-based regulations. Bajaj Housing Finance is one such NBFC and is projected to raise between $900 million and $1 billion through its proposed IPO. As per RBI's current regulatory timeline, the company must get listed by September 2025.
Early stage negotiations for IPO
Bajaj Housing Finance has entered early-stage talks with a chosen group of domestic and foreign investment banks for its proposed listing. A team of investment bankers will be selected from this group to kick off the deal in the coming weeks. This event will mark the first IPO from the prestigious Bajaj Group in several years. The IPO is anticipated to be a mix of primary and secondary issue of shares.
Pre-IPO performance: Bajaj Housing Finance shows strength
Bajaj Housing Finance, a diversified NBFC, caters to over 76.5 million customers across India. As of December 31, the company managed assets worth Rs. 85,929 crore, reflecting a 31% increase over the previous year. Disbursements also surged by 31% to Rs. 25,308 crore. The company's net profit witnessed a remarkable rise of 41% to Rs. 1,350 crore.