Bajaj Finance Allots Warrants Worth ₹5,799 Crore to Promoter Bajaj Finserv

Non-banking financial company (NBFC) Bajaj Finance has announced the allotment of 5.74 crore warrants to its promoter, Bajaj Finserv, on a preferential basis, aggregating to ₹5,799 crore.

According to a regulatory filing by the company, a special committee of the board of directors approved the issuance of 5,74,25,740 warrants. The issue price has been set at ₹1,010 per warrant. The transaction has been carried out in accordance with Chapter V of the Securities and Exchange Board of India (SEBI) regulations.

The company stated that each warrant is convertible into an equivalent number of equity shares. These shares will rank pari-passu with the fully paid-up equity shares of the company.

Regarding the payment structure, a minimum of 25 percent of the total consideration is payable on the date of allotment. The remaining 75 percent will be payable at the time equity shares are allotted, pursuant to the exercise of options against the warrants, in line with SEBI ICDR Regulations.

"Preferential warrant issuances to promoters are a strategic mechanism used by established financial institutions to solidify capital structures and demonstrate long-term commitment. For a major NBFC like Bajaj Finance, securing a substantial capital infusion of nearly ₹5,799 crore from the promoter entity, Bajaj Finserv, reinforces financial stability. The structured payment model, requiring 25 percent upfront with the remainder tied to equity conversion, ensures calculated capital deployment in alignment with regulatory standards." — Dr. Shishir Gupta, Founder & CEO, StartupLanes