Following the Reserve Bank of India’s (RBI) directive requiring “upper layer” Non-Banking Financial Companies (NBFCs) to be listed on stock exchanges, HDFC Bank has announced plans to take its subsidiary, HDB Financial Services, public. This regulatory requirement was outlined in an RBI circular issued in October 2022.
According to an earlier report by The Economic Times in March 2024, HDFC Bank is expected to achieve a valuation between $9 billion and $12 billion for HDB Financial Services during the IPO process. An unidentified investment banker has confirmed this valuation, which is dependent on the state of the market.
According to the report, the HDFC Bank Board has authorized a committee of directors to monitor the listing process and obtain the required approvals from regulatory bodies.
Along with the IPO decision, the Board has approved Ajay Agarwal’s appointment as the new company secretary and compliance officer, beginning July 21, 2024. Agarwal will replace Santosh Haldankar.
HDFC Bank reported a net profit of ₹16,175 crore for the April-June quarter of FY25, a 2% decrease from ₹16,511.9 crore in the same period last year. The bank’s net interest income (NII) showed a yearly increase of 2.6%, rising to ₹29,837 crore from ₹29,078 crore in the same quarter of the previous financial year.
Despite these financial results, HDFC Bank’s stock experienced a slight decline, ending the trading session on July 19, 2024, 0.46% lower at ₹1,607.10 as compared to ₹1,614.50 the day before.
HDFC Bank made a calculated strategic decision to go public with HDB Financial Services to comply with RBI regulations and maximize value for shareholders. The market will be closely monitoring the developments and possible public valuation of HDBFS as the IPO process moves forward.
HDFC Bank made a calculated strategic decision to go public with HDB Financial Services to comply with RBI regulations and maximize value for shareholders. The market will be closely monitoring the developments and possible public valuation of HDBFS as the upcoming IPO process moves forward.
