Bajaj Housing IPO: GMP declines ahead of stock listing today

On Monday, September 16, shares of Bajaj Housing Finance are scheduled to launch on Dalal Street. During the three-day bidding procedure, the issue garnered unprecedented interest from investors and is expected to witness a multibagger listing at the bourses. But lately, its premium on the black market has decreased.

Before becoming public, Bajaj Housing Finance shares were fetching a grey market premium (GMP) of 73–75 per share, which indicated to investors a listing premium of 104–105 percent. But before the unprecedented bidding for the offer, the gray market premium was at Rs 84 per share.

Bidding for Bajaj Housing Finance’s IPO took place from September 9–11. The Pune-based business sold its shares in lots of 214 at a predetermined price between Rs. 66 and Rs. 70 per share. With the help of a new share sale valued at Rs 3,560 crore and an offer-for-sale (OFS) valued at Rs 3,000 crore from Bajaj Finance, the firm was able to raise Rs 6,560 crore via its main offering.

The issue was subscribed to 63.61 times total and witnessed strong bidding. A remarkable 209.36 times were reserved for the qualified institutional bidders (QIBs) quota. 41.51 times as many non-institutional investors subscribed to the quota. Bidding took place 17.53 times, 2.05 times, and 7.04 times for the fraction set aside for shareholders, workers, and retail investors, respectively.

The first Indian initial public offering (IPO) to get bids over Rs 3 lakh crore was Bajaj Housing Finance. Bids for 46,28,35,82,522 equity shares, valued at Rs 3.24 lakh crore, were received by the business. For the 17,75,75,756 shares offered for this category, only the QIB part received bids for 37,17,70,59,692 shares valued more than Rs 2.60 lakh crore.

Founded in 2008, Bajaj Housing Finance is a non-deposit-taking housing finance company (HFC) that has been providing mortgage loans since the 2018 fiscal year. The firm has been registered with the National Housing Bank (NHB) since 2015. It is a member of the Bajaj Group, an eclectic collection of businesses with a range of industry interests.

Brokers were mostly optimistic about the product, advising investors to invest in it for the long run because to its great track record, robust market share, increasing AUM, affordable cost of capital, and promising development prospects. But the company’s main worry is exposure to real estate and asset concentration.

The book running lead managers of the Bajaj Housing Finance IPO were BofA Securities India, Axis Capital, Kotak Mahindra Capital Company, Goldman Sachs (India) Securities, SBI Capital Markets, JM Financial, and IIFL Securities. Kfin Technologies served as the issue’s registrar. The company’s shares will be listed on the BSE and NSE.