The ₹12,500 crore IPO, which closed for subscription last week, received a healthy response, particularly from institutional investors and the high net worth individuals.
The qualified institutional bidders (QIBs) portion received bids for 55.47 times the shares on offer, while the non-institutional investors (NIIs) portion was also subscribed 10 times.However, retail investors chose to exercise caution with the portion reserved for them getting bid for only 1.4 times the total shares on offer.
Follow Live Updates on HDB Financial Services IPO Listing here
HDB Financial investors placed bids for 217.7 crore shares as against 13.04 crore shares that were put up for bidding.
Narendra Solanki of Anand Rathi Shares and Stock Brokers advised investors to consider holding the stock for long-term post listing.
“At the upper price band, the company’s FY25 price-to-book (P/B) ratio stands at 3.7x, with a post-issue market capitalisation of ₹61,387.9 crore. Backed by the strong parentage of HDFC Bank, India’s second-largest private bank by total assets, the company offers a well-diversified product portfolio with robust granularity, scale, and sound lending quality,” he said.
Prashanth Tapse of Mehta Equities expects a healthy listing gain of 8-10%. The analyst believes the robust response signals market confidence in HDB’s business model, parentage (as an HDFC group company), and long-term growth potential in the NBFC space.
On post-listing strategy, Tapse recommended investors who missed the allotment to consider buying on dips if the stock sees short-term volatility. “HDB Financial is well-placed for a structural credit upcycle in India and is suitable for investors with a 3-5 year view,” he added.
Key Strengths– Strong linkages with parent HDFC Bank
– Established presence in granular retail segment
– Comfortable capital structure and diversified resources profile
Key Weaknesses
– Moderate asset quality
– Presence in unsecured and relatively riskier segments
– Strong liquidity
HDB Financial has also become the second-most subscribed Indian IPO, whose value has been in excess of ₹10,000 crore. The 16.7x subscription was higher than Coal India (15.28x) but fell short of SBI Cards (26.54x).
Most of the other large IPOs above ₹10,000 crore, including Hyundai Motor India, LIC, Paytm, among others, have seen overall subscription figures between 1.5x to 3x the shares on offer.
HDFC Bank currently holds a 94.36% stake in HDB Financial Services.
Ahmedabad-headquartered HDB Financial Services is a retail-focused, non-banking financial company. Its lending products are offered through the three business verticals- enterprise lending, asset finance and consumer finance. It also offers business process outsourcing (BPO) services to its parent HDFC Bank.
