Indian non-bank lender Bajaj Finance (BJFN.NS) has announced plans to raise up to 100 billion rupees ($1.20 billion) through the issuance of shares to institutional investors and warrants to its largest shareholder, Bajaj Finserv (BJFS.NS). As competition heats up in the lending sector, with the entry of Jio Financial Services (JIOF.NS), Bajaj Finance aims to meet the surge in demand for loans. Tata Capital and Aditya Birla Capital (ADTB.NS) are also rushing to raise fresh funds.
Bajaj Finance will raise up to 88 billion rupees through a qualified institutional placement of shares and an additional 12 billion rupees through the issuance of warrants convertible into shares to top shareholder Bajaj Finserv. Following the issue, Bajaj Finserv’s stake in the company is expected to increase from 52.45% to 52.57%. The issue price will be determined at a later stage.
This move marks Bajaj Finance’s latest effort to raise funds, following a qualified institutional placement in 2019 that raised 85 billion rupees. The company reported a 26% growth in new loans booked during the second quarter, while its assets under management increased by about 33% to approximately 2.90 trillion rupees as of September-end.
The announcement comes amid a surge in loan demand and intensifying competition in the sector. Several companies, including Tata Capital and Aditya Birla Capital, are also raising fresh funds to further support their growth initiatives. Bajaj Finance’s capital-raising exercise demonstrates its commitment to meeting the increasing demand for loans and maintaining its competitive edge in the market.
($1 = 83.2397 Indian rupees)
Reporting by Varun Vyas in Bengaluru; Editing by Sohini Goswami
