By Madhu Balaji
Shares of non-bank arm of HDFC Bank, HDB Financial Services, debuted on bourses at a 13 per cent premium on Wednesday.
The stock traded flat as at 10.15 am on the NSE and BSE at 鈧840.10 and 鈧839.85, respectively.
It debuted at 12.84 per cent premium on the stock exchanges at 鈧835 against the IPO price of 鈧740
The IPO was subscribed 16.69 times, with robust institutional interest. The 鈧12,500 crore IPO comprised of fresh issue worth 鈧2,500 crore and an offer-for-sale of up to 鈧10,000 crore by HDFC Bank.
Emkay Global has initiated coverage on the stock at a target price of 鈧900, nearly 8 per cent upside potential from the listing price.
鈥淲ith 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 RoA of 2.7 per cent / RoE of 17 per cent by March 2028, and deliver 20 per cent AUM or 27 per cent EPS CAGR over FY25-28E,鈥 Emkay said.
The brokerage highlighted the positives such as AUM strength, and customer base. The diversified product mix and continued focus on the overlooked segments should support steady, 20 per cent AUM compounding to 鈧1.8 trillion over FY25-28, it added.
Citing the RBI鈥檚 October 2024 draft circular demand no overlap in business between the bank and its subsidiary, Emkay also flagged, HDFC Bank might have to reduce its ownership in HDB Financial to under 20 per cent within a specified duration.
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Published on July 2, 2025