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HDB Financial Services, the non-banking financial arm of HDFC Bank, launched its ₹12,500 crore Initial Public Offering (IPO) today, June 25, 2025. The public issue, the largest NBFC IPO in India so far, will remain open for bidding until Friday, June 27. The IPO comprises both a fresh issue and an offer for sale (OFS) by the parent company, HDFC Bank.
At present, HDFC Bank holds a 94.36% stake in HDB Financial Services. The post-IPO shareholding will dilute marginally but the company will remain a subsidiary of HDFC Bank.
HDB Financial Services is India’s second-largest and third-fastest-growing NBFC, serving over 19.2 million customers as of March 31, 2025. The company operates a diversified lending model across three verticals: enterprise lending, asset finance, and consumer finance. It offers 13 distinct lending products, tailored by customer profile, tenure, and risk.
With a growing physical and digital footprint, the company runs over 1,770 branches across 1,170 towns and cities in 31 states and union territories. This hybrid “phygital” presence is supported by in-house and third-party digital distribution networks.
HDB Financial plans to use proceeds from the fresh issue to bolster its Tier-I capital base, supporting future lending activities and business expansion.
Ahead of the IPO, the company raised ₹3,369 crore through its anchor investor allocation. Over 141 institutions were allotted 4.55 crore shares at ₹740 each, the upper end of the price band. Major participants included:
Of the total allocation, 1.94 crore shares were allotted to 22 domestic mutual funds through 65 schemes.
According to data from BSE, the IPO was subscribed 0.08 times (8%) overall by late morning on its opening day. The breakdown is as follows:
The IPO is being managed by a consortium of top global and domestic investment banks, including JM Financial, BofA Securities India, BNP Paribas, Goldman Sachs (India), HSBC, Jefferies India, Motilal Oswal, Nomura, IIFL Securities, Nuvama Wealth Management, UBS, and Morgan Stanley India.
Anand Rathi has rated the IPO as “Subscribe,” highlighting its strong parentage, diversified lending portfolio, and reasonable valuation with a post-issue P/B ratio of 3.7x.
Centrum Broking echoed similar sentiments, emphasizing the company’s strong brand franchise, omni-channel distribution, and low-cost funding profile supported by a AAA credit rating.
Sharekhan expects healthy listing gains, citing the company’s strong growth potential and favorable sector outlook, especially given its smaller size relative to key peer Bajaj Finance.
Choice Broking has advised a “Subscribe for Long-Term” rating. While noting that the issue is fully priced and that profitability is under pressure due to narrowing net interest margins and rising costs, it believes the company is well-positioned for long-term expansion.
Analysts have flagged the following business risks:
With solid institutional backing, a diversified business model, and a strong parent in HDFC Bank, HDB Financial’s IPO has drawn significant interest from analysts and investors alike. While the Day 1 subscription was modest, it is expected that institutional bids may pick up over the remaining days. Analysts remain broadly optimistic, especially from a long-term investment perspective.
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