HDB Financial Services Limited, a non-banking subsidiary of HDFC Bank, is preparing to launch its Initial Public Offering (IPO).
The board of HDB Financial Services has approved the plan.
The IPO will consist of a fresh equity issue worth ₹2,500 crore and an offer for sale from existing shareholders. HDFC Bank owns 94.64% of HDB Financial Services.
Expected IPO Timeline
The IPO is anticipated to be available by the end of the current financial year, likely by March 2025.
The bank is currently selecting bankers for the IPO, with foreign banks like Morgan Stanley, Bank of America, and Nomura on the shortlist, along with domestic firms such as ICICI Securities, Axis Capital, and IIFL.
HDFC Bank aims for a valuation of ₹78,000-87,000 crore for HDB Finance.
They plan to sell 10-15% of their stake in the IPO, which could raise between ₹7,800-8,700 crore, helping to boost their capital adequacy.
Reason for the IPO Decision
The decision to list HDB Financial Services follows a Reserve Bank order from October 2022, which requires non-banking financial companies (NBFCs) to list under certain conditions.
This move is similar to the recent IPO of Bajaj Housing Finance, which experienced a strong listing that doubled investors’ money on the first day.
HDFC Bank Share Performance
As for HDFC Bank’s shares, they closed at ₹1,742.15, up about 2%. During trading, the price peaked at ₹1,745.
The stock reached its 52-week high of ₹1,791.90 on July 3, 2024, while the 52-week low was ₹1,363.45 on February 14, 2024.
