IPO Details
Issue Opening Date: June 25, 2025
Issue Closing Date: June 27, 2025
Issue Size: ₹12,500 Cr (@ upper price band of ₹740)
Fresh Issue: ₹2,500 Cr
OFS: ₹10,000 Cr
Our View: Subscribe for Long Term Horizon
Price Band: ₹700 to ₹740 per Equity Share
Lot Size: 20 Shares & multiples thereafter
Minimum Application Amount: ₹14,800 (20 Shares)
Maximum Application Amount: ₹1,92,400 (260 Shares)
Small HNI: ₹2,07,200 (280 Shares)
Big HNI: ₹10,06,400 (1,360 Shares)
Company Overview
HDB Financial Services is the 7th largest diversified retail-focused NBFC in India by Total Gross Loan Book, at ₹902.2 billion as of FY24. Categorized as an Upper Layer NBFC (“NBFC-UL”) by the RBI, it is also registered with IRDAI as a composite corporate agent.
The company operates through three verticals — Enterprise Lending, Asset Finance, and Consumer Finance — delivered via an extensive omni-channel “phygital” distribution network. As of March 31, 2025, it had 1,771 branches in 1,170 towns and cities across 31 States and Union Territories.
Serving 19.2 million customers as of FY25, its customer base has grown at a CAGR of 25.45% between FY23 and FY25. It boasts a strong credit rating of AAA (Stable) from CRISIL and CARE, the highest possible for NBFCs in India.
Key Highlights
Highly granular retail loan book
Diversified and seasoned product portfolio
Omni-channel, digitally-powered distribution network
Robust credit underwriting and strong collections
Advanced technology integration
High-quality liability franchise with AAA credit rating
Distinguished parentage of HDFC Bank
Objects of the Issue
Augmentation of Tier–I Capital base for future capital requirements
General corporate purposes
Offer For Sale of equity shares aggregating up to ₹10,000 Cr (no proceeds to the company)
Our View
Founded in 2007, HDB Financial Services is a subsidiary of HDFC Bank and a prominent NBFC in India. More than 80% of its branches are located outside the top 20 largest cities, with over 70% in Tier 4+ towns. Its average ticket size stands at approximately ₹165,000 as of March 31, 2025.
Total Gross Loans grew at a CAGR of 23.54% from FY23 to FY25, reaching ₹1,068.8 billion. Assets under management rose to ₹1,072.6 billion over the same period with a CAGR of 23.71%.
Risks to consider: Economic slowdowns, customer defaults, collateral value declines, and regulatory changes. HDFC Bank’s majority stake could affect policies, with potential ownership reduction impacting borrowing costs and share price.
Financials: Revenue CAGR of 14.64% and PAT CAGR of 5.38% from FY23 to FY25. ROA stood at 2.16% and ROE at 14.72% in FY25. Net NPA was 0.99% and Credit Cost Ratio was 2.14%. IPO valuation is at P/BV of 3.72 (NAV ₹198.8) and P/E of 28x vs industry average P/E of 23.2x and P/BV of 3.6.
Backed by the strong parentage of HDFC Bank and positioned for India’s growing credit demand, HDB Financial Services offers a solid long-term investment case for patient investors.
