Tue Sep 17 07:16:06 UTC 2024: ## Bajaj Housing Finance Soars on Market Debut, But Some Experts See Risk

**Mumbai, India** – Shares of Bajaj Housing Finance Ltd (BHFL) surged on Tuesday, marking a stellar performance following its highly anticipated market debut. The stock reached a fresh high, closing at ₹181.48 on the BSE and ₹181.50 on the NSE, representing a 10% increase from the previous day. This surge propelled the company’s market capitalization to a staggering ₹1.51 lakh crore.

BHFL’s initial public offering (IPO) on Monday saw a 114% premium over the issue price, closing at ₹165, exceeding expectations. Analysts attribute this strong debut to the company’s focus on home loans, particularly for the mass affluent segment, with an average ticket size of ₹50 lakh. Brokerage Phillip Capital, initiating coverage with a “buy” call and a target price of ₹210, predicts BHFL’s balance sheet to exceed ₹2 trillion within three years. They cite strong management, robust risk management practices, and superior asset quality as key strengths.

While the bullish sentiment is strong, several experts caution about the stock’s current valuation. Elara Capital’s Vice President, Shweta Daptardar, while acknowledging the company’s potential, deems the valuation expensive. Capitalmind Research’s Senior Research Analyst, Krishna Appala, echoes this concern, stating that the stock is trading at 8.2 times the expected book value, leaving little room for further upside. He suggests the current price reflects near-term growth and warns of potential selling pressure as lock-in periods for anchor investors expire.

Despite the optimistic outlook, experts caution investors to consider the risks associated with this valuation. Despite the company’s strong fundamentals and proven track record, the current stock price may be inflated by initial market enthusiasm. Investors should carefully weigh the potential rewards against the inherent risks before making any investment decisions.

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