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HDBFS IPO

HDB Financial Services Limited
IPO Doc
Start Date25-06-2025
Application Timing10am-5pm
Price Range₹700 - ₹740
Min Qty20
Min. Investment₹14000
Listing DateNA
Close Date27-06-2025

About HDB Financial Services Limited

HDB Financial Services Limited, incorporated in 2007, is a leading non-banking financial company (NBFC) in India with a strong retail lending focus. It is a subsidiary of HDFC Bank and operates through an extensive omni-channel “phygital” distribution model, combining a wide branch network with digital platforms.

The company has three primary business verticals:

Enterprise Lending – Offering secured and unsecured loans to MSMEs and salaried individuals.

Asset Finance – Financing for new and used commercial vehicles, construction equipment, and tractors.

Consumer Finance – Personal and household loans for individuals.

As of March 31, 2025, HDB had a nationwide presence with 1,771 branches across 1,170 towns and cities in 31 states and union territories, with over 80% of branches in non-metro cities. It employs more than 60,000 professionals and also provides BPO services and insurance distribution to retail lending customers.

Why To Invest in HDB Financial Services Limited

Strong Parentage: Backed by HDFC Bank, one of India’s most reputed and well-capitalized banks.

Pan-India Network: Vast presence beyond top 20 cities, capturing untapped and underbanked segments.

Robust Loan Portfolio: Highly diversified retail loan book across enterprise, consumer, and asset financing.

Consistent Growth: Despite macro challenges, revenue grew 15% YoY in FY25.

Omni-Channel Distribution: Strong offline and digital reach ensures customer penetration and operational efficiency.

Scalable Business Model: High operational leverage, supported by experienced management and technology integration.

Tier-I Capital Infusion: Fresh issue proceeds to strengthen balance sheet and support lending expansion.

Financial Table
Period Ended 31 Mar 2025 31 Mar 2024 31 Mar 2023
Assets1,08,663.29 92,556.51 70,050.39
Revenue16,300.28 14,171.12 12,402.88
Profit After Tax 2,175.92 2,460.841,959.35
EBITDA9,512.378,314.136,251.16
Net Worth 14,936.50 12,802.76 10,436.09
Reserves and Surplus 15,023.9712,949.6310,645.57
Total Borrowing 87,397.7774,330.6754,865.31
Strengths And Risks
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Backing of HDFC Bank: HDB Financial Services operates as a subsidiary of HDFC Bank, one of India’s most trusted banking institutions. This strong parentage adds financial credibility, regulatory discipline, and brand reliability to the company.
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Expanding Retail Customer Base: With a focus on underbanked and semi-urban regions, HDB has built a large and growing retail customer base. Their customized loan offerings cater to a diverse demographic, ensuring steady business growth.
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Proven Track Record Across Business Cycles: HDB has demonstrated consistent growth in revenue and profitability across different market conditions. Its diversified lending portfolio and risk management systems contribute to its stable financial performance.
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Robust Pan-India “Phygital” Network: The company operates through a strong hybrid model combining physical branches and digital platforms. With over 1,700 branches across 31 states and union territories, it ensures deeper market reach and operational efficiency.
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Efficient Credit Underwriting and Collection Systems: HDB has built robust internal systems and processes for credit assessment and collections. This results in better risk management, low delinquency rates, and improved loan recovery.
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Decline in Profitability: Despite a 15% revenue growth in FY25, the company reported a 12% decline in Profit After Tax (PAT), indicating rising operational costs or provisioning pressures that could affect future margins.
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High Leverage Ratio: With a Debt-to-Equity ratio of 5.85, the company is significantly leveraged. In a high-interest rate environment, this could increase interest costs and reduce profitability.
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Intense Market Competition: The NBFC sector in India is highly competitive, with established banks and fintech players offering similar financial products. This could impact HDB’s market share and pricing power.
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Sensitivity to Economic Cycles: HDB’s loan portfolio, especially in the MSME and consumer segments, is vulnerable to economic downturns. Any slowdown could increase default risks and deteriorate asset quality.
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Regulatory and Compliance Challenges: As an NBFC, the company is subject to evolving regulatory frameworks. Any adverse policy changes or compliance lapses could impact operations and investor sentiment.
FAQs
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