HDFC Bank has taken a major step towards enhancing its financial arm by approving a share sale worth ₹12,500 crore for its subsidiary, HDB Financial Services. This decision includes a ₹10,000 crore offer for sale (OFS) and ₹2,500 crore as a fresh issue. The move aligns with the Reserve Bank of India's (RBI) directive, mandating that non-banking financial companies (NBFCs) in the upper tier list on stock exchanges. Despite the IPO, HDB Financial Services will remain under HDFC Bank’s control. The bank currently holds a 94.64% stake in HDB Financial Services, which boasts a robust net worth of ₹13,300 crore.

HDFC Bank Approves ₹12,500 Crore Share Sale for HDB Financial Services

Key Decision to Boost Financial Strength
HDFC Bank’s board has approved a share sale totaling ₹12,500 crore for its subsidiary, HDB Financial Services. This includes a ₹10,000 crore offer for sale (OFS), allowing existing shareholders to offload some equity, and a fresh issue of ₹2,500 crore to raise new capital. The combined effort seeks to unlock value for investors and strengthen the subsidiary's financial base.

IPO Structure and Valuation Insights
The upcoming IPO will consist of equity shares with a face value of ₹10 each, amounting to ₹12,500 crore. A fresh issue worth ₹2,500 crore will provide new capital, while ₹10,000 crore will be raised through the OFS. Details regarding the exact pricing and other specifics will be decided by the appropriate regulatory and corporate bodies in due course.

HDB Financial Services to Remain a Subsidiary Post-IPO

Compliance with RBI Regulations
Despite the IPO, HDB Financial Services will remain a subsidiary of HDFC Bank, as confirmed by the bank’s regulatory filing. This compliance ensures that the bank meets all provisions required under existing financial regulations. HDFC Bank currently holds a significant 94.64% stake in HDB Financial Services, affirming its control over the NBFC post-listing.

Financial Position and Growth Prospects
HDB Financial Services closed the June quarter with an impressive net worth of ₹13,300 crore, positioning it as a strong player in the non-banking financial sector. With the IPO in sight, the company is set to leverage the additional capital to drive future growth and expand its operations.

Regulatory Push from the Reserve Bank of India

Mandatory Listing for NBFCs for Better Transparency
This decision follows an October 2022 mandate from the Reserve Bank of India, requiring non-banking financial companies in the upper layer to list on stock exchanges. The move is part of RBI’s broader effort to enhance transparency, corporate governance, and public participation in NBFCs operating at scale, such as HDB Financial Services.