HDB Financial to launch Rs 12,500 crore IPO on June 25, to be the biggest public issue of 2025 so far

HDB Financial Services, the non-banking financial arm of HDFC Bank, will launch its much-anticipated Rs 12,500 crore initial public offering (IPO) on June 25. The issue will remain open for subscription till June 27, making it the largest public issue so far in 2025 and the biggest since Hyundai Motor India’s Rs 27,000 crore IPO last year.

According to the draft red herring prospectus (DRHP), the IPO will comprise a fresh equity issue worth Rs 2,500 crore and an offer for sale (OFS) of Rs 10,000 crore by HDFC Bank, the company’s promoter. The price band for the offer will be announced in the coming days.

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HDFC Bank currently holds a 94.36 per cent stake in HDB Financial and will significantly dilute its holding through the OFS as part of capital optimisation efforts and to meet regulatory requirements. Despite the stake sale, HDB Financial will continue to remain a subsidiary of the bank in line with applicable regulations.

The proceeds from the fresh issue will be used to bolster the company’s Tier-I capital base and fund its future capital requirements, including expanding its lending portfolio. The move is seen as key to strengthening the NBFC’s balance sheet as it focuses on growth across semi-urban and rural markets.

The decision to list comes after the Reserve Bank of India, in October 2022, mandated that all NBFCs classified in the 'upper layer' must go public within three years. Last year, HDFC Bank's board had cleared the Rs 12,500 crore share sale plan, which includes the Rs 10,000 crore OFS component.

HDB Financial offers a range of secured and unsecured loans — including personal, vehicle, gold, business loans, and loans against property — catering largely to the affordable credit segment.

Investor sentiment has been strong in recent months, aided by a resilient equity market and supportive monetary policy, and the HDB Financial IPO is expected to attract significant attention from both institutional and retail participants.