HDB Financial Services made a bumper debut on D-Street on July 2, with shares listing at Rs 840, a 13 per cent premium over the IPO price of Rs 740. With this, the HDFC Bank subsidiary instantly joined the elite club of India’s top 10 non-banking financial companies (NBFCs), securing the eighth spot with a market capitalisation of nearly Rs 70,000 crore.
Here’s a breakdown of what’s driving the optimism around the stock, and why analysts are betting big on its long-term growth story:
1. Rs 70,000 crore m-cap puts HDB in top NBFC league
HDB Financial’s listing-day market cap of Rs 69,625 crore has pushed it ahead of established peers like Aditya Birla Capital and SBI Cards. It now trails only giants such as Bajaj Finance, Cholamandalam, Shriram Finance, and Muthoot Finance, solidifying its position in the top NBFC bracket right from the word go.
2. Massive investor interest: IPO subscribed 16.7x
The company’s IPO saw robust interest across categories, getting subscribed 16.7 times. Strong retail and institutional demand signalled market confidence in its business model, track record, and growth outlook.
3. Strong HDFC lineage fuels investor trust
As a subsidiary of HDFC Bank, HDB Financial inherits credibility and governance strength, which gave it a significant edge among other mid-sized NBFCs. This brand association played a key role in boosting investor appetite during the IPO.
4. Analysts bullish on diversified lending model
Brokerages like Emkay Global have initiated coverage on the stock with a ‘Buy’ rating and a target price of Rs 900 — indicating a 22 per cent upside from the IPO’s upper price band. The brokerage highlighted HDB’s highly diversified and granular loan book, wide customer base of over 1.9 crore, and strong underwriting practices.
5. Low concentration risk a major positive
Only 0.34 per cent of HDB’s assets under management come from its top 20 accounts, suggesting a well-spread lending portfolio. Analysts view this as a key strength, especially in volatile economic cycles.
6. Proven resilience across credit cycles
HDB has successfully navigated multiple downturns, including the pandemic. Analysts believe this resilience, coupled with steady expansion, has helped the company build a robust franchise in the retail lending space.
7. Valuations still attractive post listing
Despite the 13 per cent debut pop, many believe HDB shares are still attractively priced. The bullish case rests on continued earnings growth, digital expansion, and stable asset quality.
With strong fundamentals, marquee parentage, and growing investor interest, HDB Financial is emerging as a formidable force in India’s NBFC space — and D-Street is watching closely.
