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HDB Financial Services IPO
HDB Financial Services Ltd
₹14,000 /20 sharesMinimum Investment
HDB Financial Services IPO Listing Details
| Listed On | Issue Price | Listing Price | Listing Gains |
|---|---|---|---|
| BSE | ₹740.00 | ₹835.00 | ₹95.00 (12.84%) |
HDB Financial Services IPO Details
| Bidding Dates | Min. Investment | Lot Size | Price Range |
|---|---|---|---|
| 25 Jun ‘25 - 27 Jun ‘25 | ₹14,000 | 20 | ₹700 - ₹740 |
| Issue Size | IPO Doc |
|---|---|
| 12500.00Cr | RHP PDF |
Subscription rate
As of 27 Jun'25, 05:00 PM
| Qualified Institutional Buyers | 55.47x |
| Non-Institutional Investor | 9.98x |
| Retail Individual Investor | 1.38x |
| Employees | 5.66x |
| Shareholder | 4.23x |
| Total | 16.67x |
About HDB Financial Services
Founded in
2007
Managing director
Mr. G. Ramesh
Parent organisation
HDB Financial Services Ltd
HDB Financial Services Ltd IPO
https://www.youtube.com/watch?v=4jYrqIeexjA
Strengths & Financials of HDB Financial Services
Strengths
Risks
HDB Financial Services claims to have served 17.5 million customers as of September 30, 2024, with customer growth at a compound annual growth rate (CAGR) of 28.22 percent since FY22.
The company claims to focus on underbanked and ‘new to credit' segments, with customers classified as ‘new to credit’ accounting for 12.02 percent of the total gross loan book, as of September 30, 2024. The company further states that its top 20 customers contribute less than 0.36 percent of total loans, reflecting a de-risked and low-concentration lending profile.
The company claims to offer 13 distinct lending products across enterprise lending, asset finance, and consumer finance, each with independent operations and dedicated management teams. Its loan portfolio is reportedly balanced, with no single product exceeding 25 percent of the total gross loan book. HDB also claims that its portfolio has remained resilient across multiple economic disruptions, including the 2008 financial crisis, the 2018 NBFC liquidity crunch, and the COVID-19 pandemic.
HDB Financial Services claims to operate a pan-India ‘phygital’ distribution model comprising 1,772 branches across over 1,162 towns and cities, with more than 70% of branches located in tier 4+ towns. The company claims its internal sales force is supported by a large external distribution network of over 140,000 retailers and dealer touchpoints, along with partnerships with 80+ brands and original equipment manufacturers (OEMs). Additionally, HDB claims to enhance reach through digital platforms such as its own mobile application and fintech partnerships.
The company claims to maintain a dedicated in-house underwriting team of around 4,500 professionals and a collections workforce of over 12,000. It reportedly uses a hybrid credit model combining centralised and decentralised underwriting, along with data-driven decision systems and customised scorecards for high-precision risk assessment. HDB further claims that over 95% of its loans and collections, as of the period ended September 30, 2024, are processed through digital or banking channels, and that its low gross non-performing assets (GNPA) (1.90%) and net non-performing assets (NNPA) (0.63%), as of FY24, reflect the strength of its credit and collections framework.
HDB Financial Services claims to have built an advanced and scalable digital infrastructure spanning sourcing, onboarding, underwriting, servicing, and collections. It has developed paperless onboarding journeys, artificial intelligence/machine learning (AI/ML)-driven credit scorecards, and application programming interface (API) integrated tools for employees and partners. Its ‘HDB On-the-Go’ mobile application enables customers to avail loans, track applications, access documentation, and raise service requests.
The company claims to have access to one of the most cost-effective and diversified borrowing bases among Indian NBFCs, supported by a CRISIL and CARE credit rating of AAA (Stable), the highest rating in the sector.
The company claims to have a high debt-to-equity ratio of 5.93x as of September 30, 2024, contributing to a strong return on average equity of 16.39 percent.
The company has witnessed a consistent increase in revenue from operations and profit after tax (PAT). Revenue from operations increased from Rs 11,306.29 crore in FY22 to Rs 12,402.88 crore in FY23 and Rs 14,171.12 crore in FY24. PAT increased from Rs 1,011.4 crore in FY22 to Rs 1,959.35 crore in FY23 and Rs 2,460.84 crore in FY24.
Unsecured loans accounted for Rs 28,517.36 crore (28.92 percent) of the company’s total gross loan book in the period ended September 30, 2024, Rs 25,858.95 crore (28.66 percent) in FY24, Rs 18,998.83 crore (27.13 percent) in FY23, and Rs 16,200.4 crore (26.42 percent) in FY22. Any adverse change in customer repayment behaviour or economic distress could severely impact recoverability, as these loans are not backed by collateral. The company may be forced to increase its provisions for credit losses, which would negatively affect earnings.
Secured loans accounted for Rs 70,106.85 crore (71.08 percent) of the company’s total gross loan book in the period ended September 30, 2024, Rs 64,358.98 crore (71.34 percent) in FY24, Rs 51,031.87 crore (72.87 percent) in FY23, and Rs 45,125.93 crore (73.58 percent) in FY22. Any decline in collateral value, especially for depreciating assets like automobiles, or delays in enforcement proceedings may negatively impact the company’s ability to recover dues and affect its overall financial condition.
As a non-deposit taking NBFC that relies on wholesale borrowings, HDB Financial Services is exposed to fluctuations in interest rates, which directly affect its finance costs. In FY24, while net interest income increased to Rs 6,292.4 crore from Rs 5,415.86 crore in FY23, the net interest margin declined to 7.85 percent from 8.25 percent, during the same period, due to rising borrowing costs. Any mismatch in the repricing of assets and liabilities, particularly in periods of rate volatility, could adversely impact the company’s profitability, cash flows, and overall financial condition.
The company’s business is impacted by seasonality, with higher demand for consumer finance products during festive months and increased demand for asset finance products in the fourth quarter of the fiscal year. Any inability to effectively manage this fluctuation in demand could adversely affect its business and financial condition.
The company, its promoter, and directors are involved in certain legal proceedings, including criminal and tax-related matters. Any adverse judgments in any of these cases could be detrimental to the company’s business prospects.
The company reported negative cash flow from operating activities amounting to Rs 9,208.85 crore in the period ended September 30, 2024, Rs 16,736.04 crore in FY24, and Rs 6,850.61 crore in FY23. Additionally, negative cash flow from investing activities amounted to Rs 2,145.56 crore in FY24 and Rs 703.28 crore in FY22. The company also reported negative cash flow from financing activities in FY22, amounting to Rs 1,499.54 crore. Furthermore, the company experienced a net decrease in cash and cash equivalents amounting to Rs 81.3 crore in FY23 and Rs 215.72 crore in FY22. If cash outflows continue to exceed inflows in the future, the company may face liquidity challenges.
As of September 30, 2024, the company had contingent liabilities amounting to Rs 613.72 crore. If any of these contingent liabilities materialise, it may adversely affect the company’s financial condition.
As of September 30, 2024, the company had outstanding financial indebtedness of Rs 82,681.1 crore. Any failure to service or repay these loans can hurt the company’s operations and financial position.
HDB Financial Services Financials
*All values are in Rs. Cr
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Application Details of HDB Financial Services IPO
| Apply as | Price band | Apply upto |
|---|---|---|
| Regular | ₹700 - 740 | ₹2 Lakh |
| Employee | ₹700 - 740 | ₹2 Lakh |
| Shareholder | ₹700 - 740 | ₹2 Lakh |
| High Networth Individual | ₹700 - 740 | ₹2 - 5 Lakh |
For HDB Financial Services IPO, eligible investors can apply as Regular, Employee & Shareholder.