HDB Financial Services Ltd., a leading non-banking financial company (NBFC) and a subsidiary of HDFC Bank Ltd., concluded its three-day IPO on Friday, June 27, 2025, with overwhelming demand from all investor categories. The public offering was subscribed 16.69 times, making it one of the most sought-after IPOs in Indian history for issues above ₹10,000 crore.

Record-Breaking Demand from Investors

At the upper end of the price band of ₹740 per share, the IPO received bids for 217.7 crore shares, significantly higher than the 13.04 crore shares on offer. This translated into total bid value of ₹1.61 lakh crore, narrowly beating Tata Technologies IPO's ₹1.56 lakh crore bids from 2023. However, it still remained behind the ₹3 lakh crore record held by Bajaj Housing Finance.

Institutional Investors Lead the Surge

The primary strength in demand came from Qualified Institutional Buyers (QIBs), who accounted for a major chunk of the subscriptions. The QIB segment alone was oversubscribed by 55.47 times, with 177 crore shares bid against 3.21 crore shares reserved for them.

This response highlighted strong institutional confidence in HDB Financial’s business model, future growth potential, and robust parentage under HDFC Bank.

Other Categories Also See Strong Interest

Apart from QIBs, several other investor groups actively participated in the IPO:

• Non-Institutional Investors (NII): 24 crore bids vs 2.41 crore shares reserved (10x subscription)

• Retail Individual Investors (RII): 7.91 crore bids vs 5.61 crore shares reserved (1.41x subscription)

• HDFC Bank Shareholders: 7.6 crore bids vs 4.15 crore shares reserved (4.26x subscription)

• Employees of HDB Financial: 16.33 lakh bids vs 2.86 lakh shares reserved (5.72x subscription)

The retail segment, although fully subscribed, saw the lowest subscription ratio, reflecting broader market trends of cautious retail participation in large IPOs.

Comparing with Historic IPOs

With this performance, HDB Financial has now become the second-most subscribed IPO in India in the category of offers above ₹10,000 crore. Here's how it compares:

• SBI Cards IPO (2020): 26.54x

• HDB Financial IPO (2025): 16.7x

• Coal India IPO (2010): 15.28x

In contrast, many other large IPOs like LIC, Hyundai Motor India, and Paytm saw relatively moderate subscription levels in the range of 1.5x to 3x, underscoring the exceptional interest in HDB’s offer.

IPO Allotment and Listing Date

According to the IPO schedule, the allotment of shares will be finalized on Monday, June 30, 2025, and the listing of shares is expected on Tuesday, July 1, 2025, on both the NSE and BSE.

Investors who participated in the IPO can check their application status on the registrar's website, and successful applicants will receive shares in their demat accounts by the listing day.

Key Reasons Behind Strong Investor Interest

Several factors contributed to the massive demand for HDB Financial’s IPO:

• Strong Parentage: As a wholly-owned subsidiary of HDFC Bank, investor confidence in corporate governance and stability is high.

• Diversified Lending Portfolio: HDB provides a wide range of retail loans, including personal loans, consumer durable loans, and commercial vehicle financing.

• Digital Transformation: Over the years, the company has significantly invested in technology and digital platforms, improving loan origination, disbursal, and risk assessment.

• Profitability Track Record: Despite macroeconomic volatility, HDB has maintained healthy profit margins, which makes it a solid investment bet in the NBFC space.

• Market Conditions: The IPO launched during a relatively stable market environment, and with the positive secondary market sentiment, investors were keen to ride the momentum.

Breakup of Subscription Across Categories

What Happens Next for Investors?

For investors awaiting the listing, it will be important to:

• Monitor listing day volatility, as heavily oversubscribed IPOs often see a premium opening.

• Track grey market premium (GMP) movements to assess pre-listing sentiment.

• Consider holding for the long term, especially if listing price remains close to issue price, given the company’s potential.

Looking at the Bigger Picture

This IPO sets the stage for more high-profile listings in the NBFC and BFSI sectors. It also shows that investor appetite for quality, well-governed companies remains strong despite the growing number of IPOs.

HDB Financial’s success also strengthens the position of HDFC Bank as a parent company, which could positively impact the stock valuation of the bank itself.

Final Thoughts:

The resounding success of the HDB Financial IPO confirms India’s vibrant capital market environment, especially in 2025. As investors await the stock’s debut on July 1, the focus now shifts to its listing gains and long-term performance. Given the strength of its fundamentals, HDB Financial is poised to make a solid mark on the Indian stock exchanges.

The Upcoming IPOs in this week and coming weeks are Crizac, Silky Overseas, Vandan Foods, Pushpa Jewellers, Cedaar Textile, Marc Loire Fashions.

The Current active IPO are Neetu Yoshi, Adcounty Media India, Moving Media Entertainment, Valencia India, PRO FX Tech, Ace Alpha Tech, Indogulf Cropsciences, Suntech Infra Solutions, Rama Telecom, Supertech EV, Sambhav Steel Tubes, HDB Financials.

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