HDB Financial Services Ltd, the non-banking financial company (NBFC) arm of India’s biggest private sector lender HDFC Bank, is gearing up to launch its Rs 12,500-crore initial public offering (IPO) by mid-July, sources told Moneycontrol.
The retail lender’s IPO would be the biggest of the year, surpassing the Rs 8,750-crore offer of IT player Hexaware Technologies in February, signifying the return of animal spirits in the Indian primary market.
The sources said the NBFC is preparing its updated draft red herring prospectus, the so-called UDRHP, a precursor document to filing the red herring prospectus (RHP), the final step before the launch of an initial share sale.
The UDRHP is likely to be filed before the end of this month, with the company looking at early to mid-July offer launch, barring unforeseen volatility in the market, the sources said.
A UDRHP is a revised version of the draft red herring prospectus that a company files with the Securities and Exchange Board of India (SEBI).
After a company submits its DRHP, the stock exchange and SEBI review the document and may suggest amendments or seek additional disclosures. The company is required to incorporate these changes and file the UDRHP, which reflects all the updates and ensures the prospectus is compliant with regulatory requirements.
Once the UDRHP is approved, the company files RHP with SEBI and the Registrar of Companies after which the IPO can be launched.
The NBFC, which filed the DRHP on October 30, received SEBI’s go-ahead for the share sale at the end of May.
An email sent to HDB Financial Services had not elicited a response till the time of publication of this article.
Founded in 2007, HDB Financial Services provides a range of loans to both individual and business clients across India. Its business is organised into three main verticals — enterprise lending, asset finance and consumer finance.
The company specialises in secured and unsecured loans, consumer loans, and loans against property, with a strong presence among underbanked customer segments.
The IPO is primarily driven by the Reserve Bank of India’s 2022 regulation requiring large NBFCs — classified as “upper layer”— to list on the stock exchange by September 2025.
HDB’s gross loan book stood at Rs 98,620 crore as on September 30, 2024, reflecting a compound annual growth (CAGR) rate of 20.93 percent between March 31, 2022 and September 30, 2024.
The NBFC generated a profit of Rs 2,460 crore in FY24, which reflected a CAGR of 55.9 percent between FY22 and FY24.
“Our focus has remained on building a highly granular loan book with our 20 largest customers accounting for less than 0.36 percent of our total gross loans as at September 30, 2024. Our aggregated average ticket size stood at approximately Rs 145,000 as at September 30, 2024,” the NBFC said in its DRHP.
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