HDFC Bank Ltd.'s unit, HDB Financial Services, is set to open its Rs 12,500-crore initial public offering on Wednesday.
HDB Financial plans to raise Rs 2,500 crore via a fresh issue of shares and Rs 10,000 crore through an offer for sale of shares held by HDFC Bank. The company has set a price band at Rs 700 to Rs 740 per share for the IPO.
The lead book runners for the IPO are 12 investment banks, including JM Financial, BNP Paribas, BofA Securities, Jefferies, Goldman Sachs, HSBC Securities, Nomura, IIFL Securities, Morgan Stanley, Nuvama, Motilal Oswal and UBS. Cyril Amarchand Mangaldas is the company counsel, and Link Intime India Pvt. will be the registrar, according to the RHP.
HDB Financial Services IPO Details
Issue opens: June 25.
Issue closes: June 27.
Issue price: Rs 700-Rs 740.
Fresh issue: Rs 12,500 crore.
Lot size: Minimum 20 shares, and then in multiples thereof.
HDB Financial Services: Business
HDB Financial Services is one of the leading diversified retail-focused non-banking financial companies in India in terms of total gross loan book size, according to a Crisil report. The company is categorised as an upper-layer NBFC by the RBI and offers a large portfolio of lending products through a wide omni-channel distribution network.
Its lending products are offered through three business verticals — enterprise lending, asset finance and consumer finance.
Use Of Proceeds
The fresh issue proposed will be used for augmenting the company’s Tier-I Capital base to meet the company’s future capital requirements, including onwards lending for the growth of business. Further, a portion of the proceeds from the fresh issue will be used towards meeting offer expenses, according to the filing.
Financial Performance
In financial year 2025, the NBFC generated a profit after tax of Rs 2,180 crore, which shows a CAGR of 5.38% between fiscal years 2023 and 2025.
The company's income from operations stood at Rs 16,300.28 crore as of March 2025. Income from operations for the previous fiscal year stood at Rs 14,171.12 crore and at Rs 12,402.88 for the financial year 2023.
In financial year 2023–24, the NBFC generated a profit of Rs 2,460 crore, which reflected a CAGR of 55.98% between financial year 2022 and 2024, the DRHP said. The company recorded a net profit of Rs 1,959.35 for the financial year 2023.
HDB Financial Services IPO: Key Risks
Promoter Shareholding Risk: HDB Financial Services Ltd.'s promoter may be required to significantly reduce its ownership in the company to below 20% (or to a higher percentage only with prior RBI approval) due to overlapping business interests with a member of the promoter group. If implemented in its current form, this may have a material adverse impact on HDB Financial’s business operations.
Asset Quality Concerns: HDB Financial’s gross stage 3 loans stood at 2.26% of total gross loans as of March 31, 2025. Any increase in customer defaults, insufficient provisioning for non-performing assets, or changes in regulatory provisioning requirements could negatively affect the company’s financial condition.
Secured Loan Exposure Risk: As of March 31, 2025, secured loans comprised 73.01% of HDB Financial’s total gross loans. A decline in value or delays could impair the company’s ability to recover dues, thereby exposing it to potential credit losses that may adversely impact its business.
HDB Financial Services IPO GMP
The grey market premium of the HDB Financial Services IPO slipped to Rs 53 as of 11:32 a.m. on June 23, according to InvestorGain. This implies shares of the company will likely list at Rs 793 apiece, indicating a 7.16% premium to the upper end of the price band.
It should be noted that GMP, or grey market price, is not an official price quote for the stock and is based on speculation.
Disclaimer: Investments in initial public offerings are subject to market risks. Please consult with financial advisors and read red herring prospectus thoroughly before placing bids.
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