Bajaj Housing Finance issue opens today; GMP signals 73% upside

Key insights

* The issue opens today and closes on 14th Dec 2023. * The issue comprises of Secured, Redeemable, Non-Convertible Debentures of the face value of Rs. 1,000 each. * The issue has a base size of Rs. 500 crore with an option to retain oversubscription up to Rs. 2,000 crore aggregating up to Rs. 2,500 crore. * The issue is rated as ‘CRISIL AAA/Stable’ by CRISIL. * The issue is available in two series: * Series I: Non-Callable for 3 years and Callable on or after 5 years from the date of allotment at the option of the Issuer. * Series II: Non-Callable for 5 years and Callable on or after 7 years from the date of allotment at the option of the Issuer.

Detailed insights

The issue opens today and closes on 14th Dec 2023. The issue comprises of Secured, Redeemable, Non-Convertible Debentures of the face value of Rs. 1,000 each. The issue has a base size of Rs. 500 crore with an option to retain oversubscription up to Rs. 2,000 crore aggregating up to Rs. 2,500 crore. The issue is rated as ‘CRISIL AAA/Stable’ by CRISIL. The issue is available in two series: * Series I: Non-Callable for 3 years and Callable on or after 5 years from the date of allotment at the option of the Issuer. * Series II: Non-Callable for 5 years and Callable on or after 7 years from the date of allotment at the option of the Issuer. The issue is proposed to be listed on BSE and NSE. The lead managers to the issue are Axis Capital, ICICI Securities and Kotak Mahindra Capital Company. The company proposes to utilize the proceeds of the issue for the following purposes: * To meet the funding requirements for onward lending, which constitutes the core business activity of the Issuer. * To repay or prepay existing indebtedness (in part or full) of the Issuer. * For general corporate purposes. The company is present across 23 states and 1 union territory in India through its network of 135 branches and 1,622 distribution touchpoints. The company's assets under management stood at Rs. 49,156 crore as on 30th Sep 2023. The company's gross non-performing assets (GNPAs) were at 1.37% as on 30th Sep 2023. The company's financial performance has been healthy in recent years. The company's net profit has grown from Rs. 663 crore in FY20 to Rs. 1,005 crore in FY23. The company's return on equity (ROE) has also improved from 13.7% in FY20 to 16.5% in FY23. The company's issue is attractively priced and offers a good opportunity for investors to invest in a well-managed and financially sound company. The issue is rated as ‘CRISIL AAA/Stable’ by CRISIL, which indicates the highest degree of safety with regard to timely payment of interest and principal. The issue is also available in two series, which offer investors the flexibility to choose the tenure that best suits their investment needs.