HDB Financial Services IPO Subscription: Should You Buy Biggest Ever NBFC IPO? GMP, Allotment, Listing Details

HDB Financial Services IPO: This HDFC Bank-backed NBFC IPO worth Rs 12,500 crore is the biggest ever in the sector in the IPO market history. On its opening day, the HDB Financial Services IPO subscribed only 37% of its offered size. The IPO will be available till June 27 for subscription. The current grey market premium (GMP) of the IPO signals a nearly 7% premium listing, which could take place next week.

Should You Subscribe to HDB Financial Services IPO?

Here's what experts have said:

"HDB Financial Services offers investors exposure to India's expanding rural and underbanked credit segments, backed by a strong parentage, digital-first infrastructure, and a diversified loan book. While valuation appears rich and regulatory overhang poses a risk, the company's long-standing profitability, wide distribution reach, and focus on secured lending provide a strong investment case for medium- to long-term investors," said, Gaurav Garg, Lemonn Markets Desk.

He also added short term investors can apply for listing gains too and there is a safety margin in valuations which provides some comfort.

Meanwhile, Rajan Shinde, Research Analyst, Mehta Equities said, "We believe HDB Financial Services Ltd IPO brings investors an opportunity to invest in one of India's leading and fastest-growing diversified NBFCs, with a well-balanced loan portfolio across Enterprise Lending, Asset Finance, and Consumer Finance. We think as it is backed by the brand strength and operational discipline of its promoter, HDFC Bank, HDB has demonstrated consistent growth, strong underwriting capabilities, and resilient asset quality-evidenced by its low GNPA and NNPA ratios. We also think with over 19 million customers, a granular loan book, and a robust phygital distribution network of 1,771 branches and 140,000+ retail touchpoints, the company is well-positioned to capture underpenetrated credit demand, particularly among "new to credit" borrowers."

By looking at the financials, the company has demonstrated a revenue growth of 14.3% in FY2024 and 15% in FY2025, with net profit rising by 25.6% in FY2024, though witnessing a modest decline of 11.6% in FY2025, mainly on account of two- fold increase in provision. On valuation parse at the upper price band of Rs.740/-, the issue is asking a market cap of Rs.61388 cr. Based on FY 2025 earnings and fully diluted post-IPO paid up capital, the company is asking for Price to book ratio (P/B) of 3.5x which seems fairly valued looking at its industry average ~3.5-4x, as per the analyst.

"Given its strong parentage, proven execution across cycles, diversified loan mix, and digital-first approach, we believe HDB Financial Services is well positioned to benefit from India's ongoing financial inclusion and expanding retail credit demand. Hence, looking at all attributes we recommend investors to "SUBSCRIBE" the HDB Financial Services Ltd IPO for long-term perspective," said Shinde.

Furthermore, Mirae Asset Capital Markets analysts highlighted that on the valuation front, at a higher price band, the issue is priced at P/BV 3.5x post issue net worth. The issue seems to be fully priced given the business's fundamentals and ROE of ~15%. Though, the company may benefit from the strong HDFC brand going forward.