Bajaj Housing Finance IPO: Grey Market Premium Soars to ₹79 Ahead of Monday’s Listing — Experts Weigh In on Pricing and Valuations

Bajaj Housing Finance’s IPO is set to list on the stock exchanges on Monday, September 16, 2024. The grey market has been buzzing with excitement, with shares trading at a premium of ₹79 today. This premium is a bit higher than the ₹77 seen on Friday.

Expected Listing Price

Experts suggest that the listing price of Bajaj Housing Finance shares could be around ₹145 to ₹150. This is about 110% higher than the top price of the IPO. The company’s book value might be 6 to 6.50 times higher than its closest competitor, PNB Housing Finance, which has a book value of around 2.

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Grey Market Signals

According to the grey market, Bajaj Housing Finance shares might list at about ₹149, combining today’s premium with the base price. This suggests a potential 110% gain for those who get shares through the IPO.

Expert Opinions on Valuation

Arun Kejriwal, from Kejriwal Research and Investment Services, warns that while the IPO is generating a lot of excitement, the post-money NAV (Net Asset Value) for Bajaj Housing Finance might be too high compared to its peers. He advises investors to be cautious and consider booking partial profits while holding onto the stock for the long term.

Astha Jain, Senior Research Analyst at HEM Securities, believes that the hype around the IPO is driven by the strong performance of other Bajaj Group stocks. She suggests that the IPO listing price may not reflect the company’s true fundamentals and recommends a ‘buy, hold, and forget’ strategy for long-term investors.

Company Financials

Prathamesh Masdekar from StoxBox highlights that Bajaj Housing Finance is a major player in the mortgage lending space, with strong growth in assets under management (AUM). The company has improved its collection efficiency and maintained low non-performing assets. Its AUM has grown significantly, making it one of the fastest-growing NBFCs in India.

The company has also improved its operational efficiency and product mix, which has helped it manage rising funding costs and boost performance.