HDFC Bank Shares Rise on HDB Financial’s ₹12,500-Crore IPO Plans

On June 16, 2025, HDFC Bank shares gained 1% after a key development: its subsidiary, HDB Financial Services, is gearing up to launch its long-awaited ₹12,500-crore initial public offering (IPO) by the end of this month.

According to news reports, the Updated Draft Red Herring Prospectus (UDRHP) has already been filed. The company is expected to:

• Submit the final Red Herring Prospectus (RHP) within days
• Launch the anchor investor portion on June 24
• Open the IPO for public subscription between June 25 and June 27

HDB Financial IPO Details

HDB Financial Services is reportedly seeking a post-money valuation of around $7.2 billion (₹62,000 crore) at the upper end of the pricing band. The IPO will include:

• A fresh issue of ₹2,500 crore
• An offer for sale (OFS) of ₹10,000 crore by HDFC Bank, which currently holds a 94.3% stake in the NBFC

This would make it the largest-ever IPO by a non-banking financial company (NBFC) in India.

Also Read: Upcoming IPOs This Week (June 16-20): 2 Mainboard IPO Debuts to Watch

Regulatory Push Behind the Listing

The listing is being driven by regulatory compliance. HDB Financial Services is categorized under the “Upper Layer” of NBFCs as per the RBI’s October 2022 framework, which mandates that all companies in this category must be publicly listed within three years, by September 2025.

Potential Future Implications for HDFC Bank

The IPO may also serve as a strategic move in light of the RBI’s 2024 draft circular on overlapping business functions between banks and their NBFC subsidiaries. If implemented, the regulation could compel HDFC Bank to:

• Reduce its stake in HDB Financial to 20%
• Merge the businesses, or
• Completely separate their offerings

Conclusion

The HDB Financial IPO marks a major milestone for HDB Financial and the broader HDFC group. For HDFC Bank, the listing provides both an opportunity for value unlocking and a necessary step toward aligning with evolving regulatory frameworks.

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