The initial public offering (IPO) of HDB Financial Services saw strong bidding interest from investors of all categories on the third and final day of the bidding process, thanks to the HNI and QIB efforts. The issue was booked at 37% on the first day and ended day two with more than 1.2 times subscription.

HDB Financial Services is selling its shares at a price range of Rs 700-740 each. Investors can apply for a minimum of 20 shares and multiples thereof. It plans to raise Rs 12,500 crore through an IPO, which will include a fresh share sale of Rs 2,500 and an offer-for-sale (OFS) of up to Rs 10,000 crore from HDFC Bank.

Key Highlights

• HDB Financial Services IPO subscribed 1.66 times on Day 3; Grey Market Premium rises to 8%.
• Qualified Institutional Buyers lead with 9.03x subscription; Non-Institutional Investors at 7.04x.

According to the data, investors bid for 51,30,44,140 equity shares, or 3.93 times, compared to the 13,04,42,855 equity shares offered for subscription at 1.10 p.m. on Friday, June 27, 2025. The bidding for the issue, which began on Wednesday, will conclude today.

The allocation designated for qualified institutional bidders (QIBs) was subscribed 7.69 times, while the portion reserved for non-institutional investors (NIIs) was subscribed 6.41 times. Shareholders and eligible employees were allocated 3.04 and 4.29 times, respectively. However, the quota reserved for retail investors was used 1.01 times at the same time.

The grey market premium (GMP) of HDB Financial Services increased significantly on the third day due to strong bidding. Last heard, the company was trading at a premium of Rs 60-65 per share in the unofficial market, implying an 8-9 percent listing gain for investors. The GMP was around Rs 50 a day ago.

Analysts generally have a positive outlook on this issue. They are optimistic about the HDFC Group's strong parentage, diverse product portfolio, pan-India network, strong customer growth, growth potential, decent asset quality, and reasonable valuations. However, the issue's concerns include an unsecured loan book, rising competition, and high operational costs.

Also Read: HDB Financial Services IPO Fully Subscribed by Day 2, GMP Rises to 8% 

HDB Financial is asking for a market capitalization of Rs 61,388 crore, and based on FY 2025 earnings and fully diluted post-IPO paid up capital, the company is asking for a price to book ratio (P/B) of 3.5 times, which appears to be fairly valued given its industry average of 3.5-4 times, said Mehta Equities.

"With its strong parentage, proven execution across cycles, diverse 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. As a result, based on all of these factors, we recommend that investors'subscribe' to the HDB Financial Services IPO for the long term," it stated.

For the fiscal year ending March 31, 2025, HDB Financial Services reported a net profit of Rs 2,175.92 crore on a revenue of Rs 16,300.28 crore. For fiscal year 2023-24, the company reported a net profit of Rs 2,460.84 crore on a revenue of Rs 14,171.12 crore. The company will have a market capitalization greater than Rs 61,250 crore.

HDB Financial Services raised Rs3,369 crore from 141 anchor investors, allotting 4.5 crore shares at Rs 740 each. It has reserved shares worth Rs 20 crore for eligible employees, and shares worth Rs 1,250 crore for HDFC Bank's eligible shareholders. QIBs will receive 50% of the net offer, followed by NIIs at 15% and retailers at 35%.

With a'subscribe for long-term' rating from AC Choski Share Brokers, HDB is well-positioned to capitalize on growth in underserved segments, thanks to its strong parentage, AAA-rated credit profile, and expanding footprint. "However, challenges around rising NPAs, elevated credit costs, and subdued ROEs remain near-term watchpoints," the company stated.

The book running lead managers of the HDB Financial IPO are BNP Paribas, JM Financial, Bofa Securities India, Goldman Sachs (India), HSBC Securities & Capital Markets, IIFL Capital, Jefferies India, Morgan Stanley India, Motilal Oswal Investment, Nomura Financial Advisory, Nuvama Wealth, and UBS Securities India, with MUFG Intime India (Link Intime) serving as the registrar.