Seizing the Opportunity: A Guide to Navigating the HDB IPO for Savvy Investors

By Rebecca, Correspondent  |  Monday, 23 June 2025, 14:54 Hrs


Seizing the Opportunity

The much-anticipated HDB IPO is drawing attention across investor circles with its ₹12,500 crore issue size, featuring a fresh issue of ₹2,500 crore and an offer for sale worth ₹10,000 crore. Scheduled from June 25 to June 27, 2025, this book-built issue will be listed on both BSE and NSE.

Amid this buzz, HDFC Sky’s One-Click IPO feature adds ease to the process, letting users swiftly apply for public issues via web or app, offering seamless bidding, UPI integration, and real-time updates for an efficient application experience.

A Closer Look at HDB Financial Services Limited

Incorporated in 2007, HDB Financial Services Limited has grown into a prominent non-banking financial company (NBFC), with a retail-centric business model. The firm operates across three core verticals—Enterprise Lending, Asset Finance, and Consumer Finance—providing a wide range of secured and unsecured loans tailored to both salaried individuals and MSMEs.

As of March 31, 2025, the company boasts 1,771 branches across 1,170 cities and towns, with a major presence in non-metro regions. Over 80% of its branches are located outside India’s top 20 cities, showcasing its strategic focus on underbanked markets.

Backed by HDFC Bank Limited, HDB Financial has also diversified into business process outsourcing (BPO) services. It supports back-office operations and distribution of fee-based products, including insurance, predominantly to its lending customers.

IPO Structure and Reservation Breakdown

The HDB Financial Services upcoming IPO offers a total of 16,89,18,919 shares. This includes:

  • Fresh Issue: 3.38 crore shares aggregating ₹2,500 crore

  • Offer for Sale (OFS): 13.51 crore shares worth ₹10,000 crore

The price band is fixed between ₹700 and ₹740 per share, with a lot size of 20 shares. For retail investors, this translates to a minimum investment of ₹14,800. The IPO opens on June 25, 2025, and closes on June 27, 2025, with allotment results expected by June 30, and tentative listing on July 2.

Out of the total shares offered, about 44.92% are reserved for Qualified Institutional Buyers (QIBs), 13.48% for Non-Institutional Investors (NIIs), and 31.44% for retail individual investors.

For investors reviewing financing options and margin planning, tools like the MTF Calculator help in evaluating interest costs and fund allocation. This can be especially useful when planning capital use across multiple market segments or offerings.

Company’s Financial Performance and Metrics

HDB Financial has witnessed a consistent rise in revenue, recording ₹16,300 crore in FY2025, a 15% increase from the previous year. However, the Profit After Tax (PAT) dipped by 12%, settling at ₹2,175 crore. Other key metrics as of March 31, 2025, include:

  • ROE: 14.72%

  • Debt/Equity: 5.85

  • Price-to-Book Value: 3.72

  • Market Cap: ₹61,253 crore

Comparing pre- and post-IPO valuations, the Earnings Per Share (EPS) stands at ₹27.41 pre-issue and ₹26.29 post-issue. Corresponding Price-to-Earnings (P/E) ratios are 27 and 28.15, respectively.

Objective of the Fund Raise

The primary purpose of the fresh issue is to enhance the company’s Tier-I capital. This will aid in meeting future financial requirements and facilitate onward lending across the Enterprise Lending, Asset Finance, and Consumer Finance segments. The injection of fresh capital aims to reinforce HDB’s already robust lending infrastructure and expand its customer base further.

Peer Landscape and Competitive Edge

Among its peers, HDB Financial stands out for its highly granular retail loan book and wide geographic coverage. Its diverse portfolio and deep-rooted customer connections in Tier-2 and Tier-3 cities position it uniquely for sustained growth. The company's credit assessment systems, robust collections mechanisms, and digitally enabled infrastructure further boost its competitive strength.

With over 60,000 employees and a broad outreach, HDB leverages a “phygital” model—blending physical branches with digital platforms—to serve an expansive customer base.

How HDFC Sky Simplifies IPO Applications

Navigating public offerings has been streamlined through HDFC Sky’s One-Click IPO feature. This tool offers a user-friendly, digital-first approach to participating in IPOs. Here's a step-by-step guide to using the feature:

  1. Log In: Access your HDFC Sky account via app or web.

  2. Go to IPO Section: Navigate to "Indian Stocks" → "IPO" tab.

  3. Choose IPO: Select HDB Financial Services IPO from the list.

  4. Enter Bid Details: Input your lot size and bid price.

  5. Make Payment: Use UPI for payment and approve the mandate.

  6. Submit: Finalise your application by confirming and submitting.

What sets this feature apart is its convenience—users can track IPOs, receive status alerts, and manage their bids all in one dashboard, eliminating paperwork and manual processes.

Final Thoughts

The IPO season has generated significant market activity, with the HDB issue being one of the largest in the NBFC space. With ₹12,500 crore on offer and strategic backing from HDFC Bank, this IPO is being closely watched by analysts and institutional participants alike.

As a book-building issue with structured reservations and clear objectives, the HDB Financial IPO represents a significant development in India’s public markets. While application processes have been simplified, informed navigation remains key.

 

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