HDFC Bank Ltd.'s unit, HDB Financial Services, price band at Rs 700 to Rs 740 per share for the IPO broadly reflects the value that we think the enterprise should create over the next few years, shared Managing Director and CEO G Ramesh.
HDB Financial Services filed the red herring prospectus on Thursday for a Rs 12,500-crore initial public offering. The IPO will open for subscription on June 25, a day after the company will raise funds through the anchor investment round. The subscription window for the issue will close on June 27.
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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.
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"We believe that for a finance company like us, it's the right time to do an IPO. We have been able to demonstrate consistent growth through cycles, which shows that our business model is resilient," he told NDTV Profit.
"It's a long-term game. We built value over a period of time, and we will continue to do so," he added.
Ramesh highlighted that, at this point, where India is, we believe that building the market and creating the market is a real opportunity right now.
HDB Financial Services is a large retail financial services company. "Our customer base grew 2 times in the last 3 years. In FY22 we had 9 million customers, while in FY25 there will be 19 million customers," he said.
"When we think of an organisation, we want to leave a great asset for the next generation of finance managers," the CEO said.
HDB Financial Services has three large verticals. "We have a business called enterprise lending, where we give loans to businesses. The second business is asset finance, where we give loans for the purchase of commercial vehicles, construction equipment and tractors. The third business is consumer finance," Ramesh explained.
The company serves a part of India that it calls 'aspirational India', which the CEO believes will grow in the years to come. "What we are focusing on is building the right metrics and right tools to deliver growth. As we have done over the years, we have built capabilities," he said.
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