HDB Financial Services’ Rs 12,500 crore initial public offering (IPO), one of the largest public issues in India’s NBFC space, is leaving 49,336 early individual investors staring at notional losses of up to 48 percent, as per its latest Red Herring Prospectus (RHP) filed on June 19.
According to the latest DRHP, 49,553 individual shareholders held equity in HDB Financial as of June 19, 2025.
While the aggregate number of shares held by them is not explicitly broken down, these investors, who acquired shares during earlier transactions, have been bought at prices ranging from Rs 1,200 to Rs 1,350 per share, based on previous filings.
With the IPO now priced at Rs 700-740 per share, these early investors are staring at notional losses of 38-48 percent, depending on the entry price.
This means, someone who acquired the shares would see the value of their investment nearly halved if the IPO lists close to the offer price band. A single investor who bought 1 crore shares at Rs 1,250 a piece would see their investment shrink from Rs 1,250 crore to Rs 740 crore, a notional erosion of roughly Rs 510 crore.
This pricing is also significantly lower than what the grey market had signalled. The grey market is essentially an unofficial and unregulated platform where shares of companies trade before their official listing.
However, “the IPO pricing is based on a rigorous institutional discovery process and extensive investor feedback,” said Ramesh G, Managing Director & CEO, during an interaction with Moneycontrol.
“Whatever is happening on the unlisted side, we have no influence,” he added, referring to the steep grey market pricing of Rs 1,250–1,300 per share that had initially set investor expectations.
HDB’s IPO includes a Rs 2,500 crore fresh issue and a Rs 10,000 crore offer-for-sale (OFS) by its parent, HDFC Bank, which is offloading 13.51 crore shares.
The bank’s average acquisition cost is Rs 46.4 per share, and at Rs 740, the bank stands to make a profit of Rs 9,373 crore, subject to applicable taxes.
Moreover, the offering comes at a time when the Reserve Bank of India’s (RBI) draft circular proposes to limit arrangements that allow NBFCs to rely heavily on parent banks, thereby impacting valuations. The decision follows the RBI’s mandate in October 2022, requiring NBFCs in the upper layer to list on the stock exchanges by September 2025, which is the company’s “primary reason to go public at this point of time,” according to what the chairman, Arijit Basu, said during the press conference.
The IPO opens on June 25 and will close on June 27. Even if it sees strong institutional demand, as expected, the sharp discount to grey market and secondary trading levels may reshape how retail investors approach pre-IPO opportunities going forward.
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