UBS Bearish On Bajaj Finance's IPO Plans Ahead Of Results, Shares Dip

Shares of Bajaj Finance were under pressure ahead of the firm’s results after global brokerage UBS issued a bearish call on the stock.

What Happened: Ahead of Bajaj Housing Finance’s board meeting on listing plans, global brokerage firm UBS has issued a “sell” recommendation for Bajaj Finance.

The firm believes that the listing of its housing finance subsidiary would not significantly improve its value. UBS analysts have set a target price of ₹6,800 per share for Bajaj Finance, indicating a potential 6% decline from current levels.

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Bajaj Housing Finance, a wholly-owned subsidiary of Bajaj Finance, is reportedly gearing up to launch its IPO within the next 12 to 18 months.

IPO Troubles? However, UBS analysts believe that the IPO may not significantly boost the company’s value, pointing to a weaker business profile when considered on a standalone basis. The brokerage anticipates a potential holding company discount affecting the company’s market price.

Headquartered in Pune, Bajaj Housing Finance provides financing for both individual and corporate clients for home purchases, renovations or commercial spaces. It also offers loans against property for various needs and working capital for business expansion.

Price Action: Bajaj Finance’s share price slipped 0.32% to ₹7,268.55 in morning trade on Tuesday after starting the session in positive territory.

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