Bajaj Housing Finance lists with a bang: Should investors hold it long term or book profits?

Bajaj Housing Finance debuted at ₹150, a 114.2% premium over IPO price. Analysts advise caution due to high valuations, despite the IPO's strong subscription.

Bajaj Housing Finance made a remarkable debut on the BSE with its shares listing at ₹150, a premium of 114.2 per cent over the issue price of ₹70. However, analysts urged caution for retail investors highlighting concerns about the stock's current valuation following the rally.

Bajaj Housing Finance shares opened at ₹150, a significant premium over its IPO price. Analysts caution retail investors regarding high valuations, despite the IPO's popularity and potential performance in a favorable interest rate environment.

Shriram Subramanian, Founder and MD, InGovern Research Services, said, “As expected the Bajaj Housing Finance stock listed at a huge premium to the IPO price. The company, coming from the Bajaj Finance stable, runs a high quality business with professional management. However, investors need to be cautious in blindly buying into the stock now, as at close to 10 times book, the stock is trading at stretched valuations.”

The IPO attracted significant attention from investors and comprised a fresh issuance of shares worth up to ₹3,560 crore along with an offer-for-sale component of shares worth ₹3,000 crore from its parent company Bajaj Finance.

"There is significant potential for decent listing gains. The company has successfully raised capital through AAA-rated fixed deposits, which has attracted banks and institutions at competitive rates. With the interest rate cycle peaking and expectations of a downward trend in rates, interest-rate-sensitive sectors and companies like Bajaj Housing Finance are well-positioned to perform. Investors should consider applying" said Vijay Chopra, a stock market expert.

The ₹6,560-crore Bajaj Housing Finance IPO opened for bidding from September 9 to September 11 and was subscribed 63.61 times.