HDB Financial Services, the NBFC arm of HDFC Bank, is set to list on the BSE and NSE today, amid early signs of strong investor demand. The IPO, priced at ₹740 per share, was quoting a grey market premium (GMP) of ₹65 ahead of its debut, indicating a likely listing around ₹805, translating to a premium of approximately 8.8% over the issue price.
Ahead of the listing, Emkay Global has initiated coverage on HDB Financial Services shares with a ‘Buy’ call, citing its highly diversified (geographically and product-wise) business and large-scale lending franchise. The brokerage has recommended a share price target of ₹900 apiece, indicating a potential 22% upside over the IPO price of ₹740 per share.
“With a favorable interest rate cycle amid frontloaded repo rate cuts driving NIM expansion, credit cost moderation, and the growth outlook improving, HDBFS is well positioned to improve profits/growth, to achieve 2.7%/17% RoA/RoE, respectively, by Mar-28, and deliver ~20%/27% AUM/EPS CAGR over FY25-28E,” Emkay said in a report.
Today, HDB Financial Services serves over 19 million customers through 1,770 branches across 31 states and union territories, with assets under management (AUM) exceeding ₹1.1 lakh crore. This growth has been achieved through a disciplined approach to profitable expansion, navigating headwinds such as demonetisation, GST rollout, and the COVID-19 pandemic — all of which disproportionately affected its borrower base, the report noted.