HDFC Bank’s shares jumps nearly 3% to hit intra-day high of Rs 1731.90 on NSE today after the bank’s board approved a Rs 12,500-crore IPO for its non-banking financial company (NBFC) arm, HDB Financial Services (HDBFS). The proposed initial public offering (IPO) will include a stake sale worth Rs 10,000 crore by HDFC Bank.
HDB Financial Services IPO Breakdown
The IPO will involve a fresh issuance of equity shares worth Rs 2,500 crore by HDBFS, in addition to the Rs 10,000-crore offer for sale (OFS) by HDFC Bank. This takes the total issue size to Rs 12,500 crore. The bank currently holds a 94.5% stake in HDB Financial.
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Additionally when launched, this will be the largest IPO ever by an NBFC in India, marking a significant milestone for the financial sector.
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Where Will be The Money Raised Wii Used?
The proceeds from the Rs 12,500-crore IPO are expected to be utilized for expanding HDB Financial Services’ lending book and enhancing its digital infrastructure, further solidifying its position in the NBFC sector. When launched, this will mark the largest IPO by an NBFC in India, representing a significant milestone for the financial sector.
Regulatory Compliance and Approvals
The bank stated in its stock exchange filing, “The board of directors of the bank at its meeting held on October 19, considered and approved the offer for sale of face value Rs 10 each of HDBFS, aggregating up to Rs 10,000 crore held by the bank in the proposed IPO, subject to market conditions, receipt of necessary approvals/ regulatory clearances and other considerations.”
Details regarding the IPO price and other specifics will be determined closer to the launch.
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