HDB Financial Services IPO: Strong Fundamentals, Low Valuation, Big Buzz

June 21, 2025: HDB Financial Services, a leading non-banking financial company (NBFC) and a wholly-owned subsidiary of HDFC Bank, is set to open its much-anticipated ₹12,500 crore initial public offering (IPO) on June 25, 2025. The IPO is one of the largest NBFC offerings in recent years and marks a critical milestone for the company as it moves toward regulatory compliance and wider investor participation.

IPO Details

• IPO Size: ₹12,500 crore
• Price Band: ₹700–₹740 per share
• Offer Structure: ₹2,500 crore fresh issue and ₹10,000 crore offer-for-sale by HDFC Bank
• IPO Opening Date: June 25, 2025
• IPO Closing Date: June 27, 2025

Despite strong investor interest, the IPO is priced approximately 42% lower than its estimated unlisted market value, signaling a conservative approach to valuation amid market volatility.

Company Overview

Founded in 2007, HDB Financial Services has grown into a major player in India’s retail lending space. The company offers a variety of financial products, including:

• Personal and business loans
• Gold and vehicle loans
• Asset financing and enterprise loans

As of FY24, HDB reported a revenue of ₹78.9 billion and a profit after tax of ₹11.7 billion. Its gross loan book has reached ₹986 billion.

Why This IPO Matters

The IPO is not only significant due to its size, but also because HDB Financial is among the NBFCs classified as ‘upper layer’ under RBI’s scale-based regulation — mandating a public listing by September 2025.

CEO Ramesh Ganesan has indicated the company may tweak its business model to align with evolving RBI norms and improve transparency post-listing.

Market Buzz & Grey Market Premium

Despite the discounted pricing, HDB’s IPO is generating excitement in the market. The grey market premium (GMP) suggests an 11% potential listing gain, hinting at strong retail and institutional demand.

Regulatory Watch

The company faced scrutiny over a past private placement to over 50 HDFC Bank employees, a possible violation of Companies Act rules, which may lead to added disclosures. However, SEBI has approved the IPO, and all compliance measures are reportedly in place.

Digital Strategy & Growth Plans

HDB is rapidly digitizing its loan services, offering 100% digital disbursements via its app and website. The company is also expanding partnerships with auto dealers and OEMs to grow its asset financing segment.

Final Word

The HDB Financial IPO presents a unique investment opportunity in India’s high-growth NBFC sector. With strong fundamentals, regulatory alignment, and backing from HDFC Bank, the IPO is expected to attract robust interest — especially given its conservative pricing.