Valuation of HDB Financial Services halves in the year gone by

4 Jul 2022 , 10:55 AM

In the previous year, HDB Financial Services’ (HDB) market value decreased by 50%, amid weak financial performance. Even while shares of competitors like Bajaj Finance have rebounded from their pandemic lows, shares of HDB are currently trading at roughly Rs625 per share in the private unlisted market, down from Rs1,200 at the pre-pandemic level.

A wholly-owned subsidiary of HDFC Bank, HDB Financial Services is owned by the latter to the tune of 95% of the business. Individuals, start-up companies, and small businesses can choose from a variety of loans and asset finance options from HDB.

Adding to the negative pressure on HDB is the uncertainty surrounding stake sales and future IPOs. As it considers merging with parent HDFC, HDFC Bank is looking for more regulatory clarification over keeping its investment in HDB.

During the March 2022 quarter, HDB registered net revenue of Rs2,141 crore as against Rs1,985 crore in the year-ago quarter, a growth of 7.9%. Profit after tax stood at Rs427 crore versus Rs5112 crore in the March 2021 quarter.