HDB Financial Services, a subsidiary of the country’s largest private bank HDFC Bank, is planning to bring an Initial Public Offering (IPO). The IPO includes a fresh issue of equity shares worth up to Rs 2,500 crore and an offer for sale (OFS) by existing and eligible shareholders. HDB Financial Services said in a statement that it will depend on the approval of the company’s shareholders, market conditions, receipt of applicable approvals, regulatory clearance and other things.
According to reports, the IPO is expected to fetch a valuation of around $7-8 billion and could see its listing by December or by the end of the current financial year. HDFC Bank, which holds a 94.64% stake in the non-financial company, is in the process of listing bankers for the issue.
These will be the advisors
According to a Money control report, Four investment banks—Jefferies, JM Financial, Morgan Stanley, and Nomura—have been named by HDB Financial Services as consultants for its initial public offering (IPO). HDB Financial Services must be registered as a “upper layer” NBFC in accordance with a Reserve Bank circular from October 2022.
IPO expected by March 2025
According to media reports, The IPO is anticipated to go live before the end of the current fiscal year. This indicates that by March 2025, the IPO will occur. The bankers involved in this issue are currently being shortlisted. Domestic firms including ICICI Securities, Axis Capital, and IIFL have been nominated alongside foreign banks like Morgan Stanley, Bank of America, and Nomura.
Why the decision was taken
Following the Reserve Bank’s directive in October 2022 mandating the mandatory listing of non-banking financial companies (NBFCs) subject to certain conditions, HDB Financial Services decided to list. Bajaj Housing Finance’s IPO has also come about as a result. Allow us to inform you that there was a blockbuster listing for Bajaj Housing Finance’s IPO. On the day of listing, the investors’ money was quadrupled by this IPO.
RBI rules
As per the RBI, All of “upper layer” NBFCs must list within three years of the notification, or by September 2025. This group includes Bajaj Housing Finance, which is about to begin the process of going public.
In the first quarter of FY25, HDFC Bank reported a profit of Rs 16,175 crore, which was 2% less than the Rs 16,511.9 crore earned in the corresponding period last year. This quarter’s net interest income increased by 2.6%.
On the NSE, HDFC Bank Ltd.’s shares closed almost 2% higher at Rs. 1,737.20 a share.
Share Status
Regarding HDFC Bank shares, they ended the day at Rs 1742.15, up around 2%. The share price reached Rs 1745 during session. The share price was Rs 1,791.90 on July 3, 2024. This represents the stock’s 52-week high. The stock price on February 14, 2024, was Rs 1,363.45. This represents the stock’s 52-week low.
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