Cash News
Bajaj Housing Finance became the fourth-best listing of 2024 after BLS E-Services, Premier Energies and Unicommerce e-solutions. The stock listed at a 114% premium to its IPO price of ₹70. Shares then extended gains to end at ₹165, a 135% jump from its IPO price.
Within a day of listing, Bajaj Housing Finance received its first “buy” recommendation from sell-side analysts, when brokerage firm PhillipCapital initiated coverage on the stock with a “buy” rating and a price target of ₹210. That is a 3x jump from its IPO price and another 27% upside from where the stock had closed on Monday. You can read more on that here.
With Tuesday’s surge, the stock is up nearly 160% from its IPO price in just two days of being a public company. So, what should investors now do? Stay put or book profits?
Dipan Mehta of Elixir Equities believes that the stock will always trade at a premium as it is the largest standalone housing finance company that is now listed, which will attract a lot of investors who want exposure to this theme or a segment within the NBFC. “So, I think you would have this outsized outperformance or outsized premium valuations going ahead as well,” he said.
“And management sounds very confident about the growth going forward and end of the day amongst all the segments of the NBFC whereas the housing finance companies (HFCs) are the safest in terms of non-performing assets (NPAs) and those credit costs because of the way they lend and the security which they have. So it’s always better to have some exposure to this segment, and being the fastest growing, the largest company, certainly it will merit a lot of attention and investor interest,” Mehta added.
Shares of Bajaj Housing Finance are currently trading 9% higher at ₹179.8.