🏦 1. Company Overview: HBD Financial Services Limited
- Background: Incorporated in 2007, HBD Financial Services Limited is a subsidiary of HDFC Bank and a key player in India’s NBFC landscape. It offers diverse lending solutions using HDFC Bank’s wide network.
- Scale and Reach: Serves 19.2 million customers through 1,771 branches across 31 states and UTs.
- Industry Rank: 7th largest diversified retail-focused NBFC in India.
- Loan Book: ₹1,069 billion as of March 31, 2025.
💰 2. IPO Details
- IPO Size: ₹12,500 crore
- Fresh Issue: ₹2,500 crore
- Offer for Sale (OFS): ₹10,000 crore (by HDFC Bank)
- Dates: Opens – June 25, 2025 | Closes – June 27, 2025
- Price Band: ₹720 – ₹740 per share
- Lot Size: 1,000 shares (₹7 lakh at upper band)
- Quota Allocation:
- QIB: 50%
- Retail: 35%
- NII: 15% (Retail cap: ₹2 lakh)
- Listing Date: Expected on July 2, 2025
- Use of Proceeds: To enhance Tier-I capital and strengthen operations
📊 3. Gray Market Premium (GMP) Update
- Current GMP: ₹74–₹89 (as of June 25, 2025)
- Expected Listing Price: ₹814–₹829
- Listing Gain Estimate: 10–12%
- Investor Sentiment: Strong due to HDFC Bank’s backing and growth potential
🔍 4. Fundamental Analysis
A. Revenue & Profitability:
| FY | Revenue (₹ Cr) | PAT (₹ Cr) | Net Margin (%) |
|---|---|---|---|
| FY23 | 12,402.88 | 2,069 | 16.7% |
| FY24 | 14,171.12 | 2,375 | 16.8% |
| FY25 | 16,300.28 | 2,176 | 13.3% |
- CAGR (FY23–FY25): Revenue – 15%; PAT – 5.38%
- Rising Costs: Operating expenses rose 20% YoY (₹6,800 crore in FY25)
- Cost-to-Income Ratio: High at 45%
B. Valuation Metrics:
- P/E Ratio: 27x (vs. NBFC avg. 25x)
- P/B Ratio: 3.5x (vs. Bajaj Finance 4.3x)
- RoA: 1.9% | RoE: 12.5% (vs. sector average ~14%)
🔁 5. Peer Comparison
| Company | P/E | P/B | RoE (%) | GNPA (%) | Market Share (%) |
| HBD Financial | 27x | 3.5x | 12.5 | 2.26 | 7% |
| Bajaj Finance | 32x | 4.3x | 17.2 | 1.10 | 20% |
| Shriram Finance | 18x | 3.8x | 15.8 | 2.50 | 12% |
| Cholamandalam Inv. | 25x | 4.0x | 14.5 | 1.85 | 8% |
- Insight: Despite a lower RoE and higher GNPA, HBD benefits from strong parentage and diversification.
📄 6. Financial Statements Snapshot
A. Balance Sheet (FY25):
- Total Assets: ₹1,15,000 crore (21% CAGR from FY21)
- Loan Book: ₹1,069 billion
- Borrowings: ₹78,000 crore (73% secured)
- Current Ratio: 1.2x | Quick Ratio: 1.0x
B. Profit & Loss:
| Year | Revenue (₹ Cr) | YoY Growth (%) |
| FY21 | 8,500.25 | – |
| FY22 | 9,875.34 | 16.2% |
| FY23 | 12,402.88 | 25.6% |
| FY24 | 14,171.12 | 14.2% |
| FY25 | 16,300.28 | 15.0% |
- Profit Dip: PAT dropped in FY25 due to a 20% jump in expenses
- Growth Driver: Diversified lending and HDFC Bank’s network
📝 7. Broker Reviews
- Motilal Oswal: “Strong parentage and growth momentum, but valuations slightly stretched. Long-term investors may consider.”
- ICICI Direct: “Fairly priced IPO with listing gain potential. Watch asset quality post-listing.”
- Angel One: “Conservative pricing, robust branch network. Good for medium-to-long term.”
- Zerodha Varsity: “Rising expenses a concern. Entry at listing price preferable.”
🎯 Conclusion
The HBD Financial Services IPO is a strategic entry into India’s retail NBFC sector, supported by HDFC Bank’s legacy. A reasonable valuation, solid customer base, and diversified portfolio favor investment. However, high costs, declining margins, and exposure to unsecured loans (27%) are red flags. Listing gains look promising (~12%), but investors should watch for post-listing performance and subscription data before making long-term commitments.
📢 Disclaimer
The information provided in this blog regarding Initial Public Offerings (IPOs) is intended solely for educational and informational purposes. It does not constitute financial advice, investment recommendations, or an offer to subscribe to any IPO. Readers are strongly encouraged to perform their own due diligence and consult with a certified financial advisor before making any investment decisions related to IPOs.
Please note that IPO dates, issue sizes, price bands, allotment status, and listing details are subject to change based on regulatory approvals and market conditions. For the most accurate and updated information, kindly refer to the official websites of the National Stock Exchange (NSE), Bombay Stock Exchange (BSE), and the Securities and Exchange Board of India (SEBI).
Incorporating relevant images and internal links within this blog can help improve user engagement and navigation.
