LIC emerged as the leading anchor investor, picking up 6.53% of the total allocation worth close to ₹220 crore
HDB Financial Services, the non-banking finance arm of India’s largest private lender, HDFC Bank, has opened its much-anticipated ₹12,500-crore initial public offering (IPO) for subscription today, June 25. Ahead of the IPO going live, HDB’s shares were trading at Rs 814 in the grey market, implying a premium of 10%.
In a show of confidence ahead of the public issue, the company successfully raised ₹3,368 crore from a host of marquee investors as part of its anchor book. The board approved the allotment of 4.55 crore equity shares to these investors at ₹740 per share.
Life Insurance Corporation of India (LIC), the country’s largest insurer, bagged the lion’s share of the anchor allocation, receiving 6.53% of the total book, totaling nearly ₹220 crore.
Other prominent global names such as BlackRock, Baillie Gifford Pacific Fund, Government Pension Fund Global, Goldman Sachs, Templeton, and the Abu Dhabi Investment Authority (ADIA) were among the other heavyweight investors participating in the anchor round.
On the domestic front, 22 mutual funds including ICICI Prudential, SBI Mutual Fund, Kotak Mahindra AMC, Axis MF, Aditya Birla Sun Life, Motilal Oswal, and HSBC MF, were allotted 1.93 crore shares, making up 42% of the anchor book.
With the anchor book now behind us, investor focus now shifts to the public subscription window, which will remain open until June 27. The IPO comprises a fresh issue of shares worth ₹2,500 crore, with the remaining ₹10,000 crore offered via an Offer for Sale (OFS) by parent company HDFC Bank.
At the upper end of the price band, the issue would value HDB Financial at over ₹61,000 crore. The funds raised through the fresh issue will be used to augment the company’s capital base, enabling it to expand its lending operations and support long-term business growth.
A consortium of leading domestic and global investment banks has been appointed to manage the issue. The list includes JM Financial, BNP Paribas, BofA Securities India, Goldman Sachs India, HSBC Securities and Capital Markets (India), IIFL Capital Services, Jefferies India, Morgan Stanley India, Motilal Oswal Investment Advisors, Nomura Financial Advisory and Securities (India), Nuvama Wealth Management, and UBS Securities India.
As one of the most closely-watched IPOs of the year, HDB Financial’s market debut will remain in the spotlight, more so as a barometer to gauge the broader investor appetite for public offers amid a period of rather calmness in the primary market.