HDB Financial Services (HDBFS) Ltd which is a subsidiary of HDFC Bank, India’s largest private sector lender, is planning to raise ₹12,500 crore with an initial public offering (IPO).
HDFC Bank currently owns a 94.6% in HDB Financial Services and it will sell ₹10,000 crore worth of shares through an offer-for-sale (OFS), the lender’s board announced in an exchange filing on Saturday, October 19, 2024.
The remaining ₹2,500 crore will be a fresh issue and the face value of the shares would be ₹10 each.
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This follows the Reserve Bank of India’s (RBI) mandate which requires ‘upper layer’ NBFCs to mandatorily go public and get listed on the stock exchanges.
“The price and other details of the proposed IPO will be determined in due course by the competent body,” HDFC Bank’s statement read. “Post the proposed IPO, HDBFS would continue to be a subsidiary of the Bank, in compliance with the provisions of the applicable regulations.”
What are the details of HDB Financial Services?
HDB Financial Services, incorporated in 2007, is a non-banking financial company (NBFC) that provides lending and business process outsourcing (BPO) services to individuals and businesses.
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The lending involves both secured and unsecured loans and the BPO services include back office services like forms processing, document verification, finance and accounting services, and correspondence management, along with front office services like contact center management, outbound marketing and collection services.
It currently has more than 1747 branches spread across 27 states & 4 union territories and is CARE AAA & CRISIL AAA rated for its long-term debt and bank facilities and A1+ rated for its short-term debt & commercial papers.
How did HDFC Bank’s shares perform?
HDFC Bank Ltd shares closed at ₹1,681.15 on the Bombay Stock Exchange after the week’s trading session ended on Friday, October 18, 2024. This was a gain of 0.47% or 7.80 points.