Research Reports

HDB Financial Services Limited (HDBFS) :


HDB Financial Services Limited (HDBFS) is one of India’s leading Non-Banking Financial Company. It is a subsidiary of HDFC Bank that caters to the growing needs of an aspirational India, serving both individual & business clients. HDB was incorporated in the year 2007. Its headquarters are in Mumbai. It has more than 1000 Branches spread across 22 States & 3 Union Territories.

CARE AAA & CRISIL AAA ratings have been assigned for long-term debt & Bank facilities of HDBFS and an A1+ rating for its short-term debt & commercial papers. This makes it a strong and reliable financial institution. It offers a wide range of secured and unsecured loans to our customers. They provide a one-stop-shop for all requirements, be it loans, investments or protection.

HDB Financial Services Unlisted Shares

About the Company

  • HDB Financial Services (HDBFS) is a leading Non-Banking Financial Company (NBFC) that caters to the growing needs of an aspirational India, serving both Individual & Business Clients.
  • The Bank was incorporated in 2007.
  • The Company’s registered office is situated in Ahmedabad, India, while its corporate office is located in Mumbai, India. As of 31st March 2020, the Company has 1468 Branches in 1070 cities in India.
  • HDB Financial Services Limited is a subsidiary company of HDFC Bank. Promoter (HDFC Bank) holds 95.30% of the total shareholding.
  • HDBFS is accredited with CARE AAA & CRISIL AAA ratings for its long-term debt & bank facilities and an A1+ rating for its short-term debt & commercial papers, making it a strong and reliable financial institution.

Industry Overview - Opportunities

  • Bank’s lending to NBFCs registered a growth of 34.7% from September 2018 to January 2020.
  • NBFCs, are gearing up to lend afresh, with the credit guarantee programme announced by the government, likely to boost their fund flow.

Products Offered

  • The Company provides lending services and business process outsourcing services. The Company also provides services related to the marketing and promotion of various financial products.
  • The Product Portfolio consists of three main categories i.e. Loans, Fee-based products & BPO Services.
  • a) Loans: The Company provides a wide variety of loans including Consumer Loans, Enterprise Loans & Asset Finance.
  • b) Fee-Based Products: The Company is registered as Corporate Insurance Agents which sell life and General Insurance Products.
  • c) BPO Services: Company has contracted with HDFC bank to collect dues. The company has set up 15 call centres across the country with 5000 seats.
  • One-stop for all Loan, Investment, and Insurance requirements.

Financial Highlights

  • The Company posted total income and net profit of INR 10,756.47 crore and INR 1,004.85 crore, respectively, for the financial year ended March 31, 2020, as against INR 8,724.81 crore and INR 1,153.24 crore respectively, in the previous year.
  • Loan disbursements during the year were ₹ 29,853 crores as against ₹ 31,654 crores in the previous year.
  • The Assets under Management (AUM) of the Company as of March 31, 2020, increased to ₹57,145 crores from ₹55,425 crores in the previous year.

Rationale

  • The Company has continued to focus on diversifying its products and expand its distribution to effectively deliver credit solutions to its market.
  • As of March 31, 2020, there was no principal or interest payment due & unpaid, which shows the company is financially stable and there is no liquidity risk in the business.
  • The Company has been consistent in paying dividends over the period of last 4 years. However, due to uncertainty due to Covid-19, the management did not recommend dividend in FY 2019-20.
  • Acko General Insurance partners with HDB Financial Services. The collaboration will offer HDBFS customers insurance covers at no additional cost with EMI cards.

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