HDB Financial Services shares are set to list on the BSE and NSE on Tuesday, July 2, following a strong response to its initial public offering, which was subscribed 16.69 times.
The IPO of HDB Financial, a subsidiary of HDFC Bank, was open for subscription between June 25 and June 27 and saw full subscription by the second day, with strong interest from institutional investors.
Market analysts expect the stock to list with gains in the range of 8-10 per cent.
“HDB Financial shares are likely to deliver 8-9 per cent listing gains. Allotted investors may hold the stock for a medium to long-term horizon,” said Mahesh M. Ojha, AVP – Research & Business Development, Hensex Securities Pvt Ltd.
The non-banking financial company (NBFC) operates with a diversified loan portfolio, including enterprise, consumer and asset financing. It has a wide presence across India with 1,771 branches and more than 60,000 employees.
Ojha noted that the company has shown steady asset quality, with gross non-performing assets (NPAs) averaging around 2.3 per cent between FY23 and FY25. During the same period, the company’s assets under management (AUM) and profit after tax (PAT) grew at a CAGR of 24 per cent and 5.4 per cent, respectively.
Prashanth Tapse, Research Analyst at Mehta Equities, said the IPO collected bids worth over Rs 1.61 lakh crore, reflecting strong interest from both institutional and retail investors.
"The HDB IPO is the second most subscribed issue among those exceeding Rs 10,000 crore, trailing only Tata Technologies. The company’s reasonable valuation, wide product portfolio and focus on SME lending make it a compelling long-term story," Tapse said.
He added that the NBFC’s strategic positioning, supported by its parent HDFC Bank, offers significant room for growth, especially in underpenetrated retail and SME credit markets.
On post-listing strategy, Tapse advised 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 said.
Narendra Solanki, Head Fundamental Research- Investment Services, Anand Rathi Shares and Stock Brokers, advised that investors may consider holding 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 capitalization of ₹6,13,879.4 million. 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 added.
HDFC Bank currently holds a 94.36 percent stake in HDB Financial Services. The IPO is the second largest in the last three years, after Hyundai Motor India’s Rs 27,000-crore offering.
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