HDB Financial Shares Slip Below IPO Price After Muted Q2 Earnings

Shares of HDB Financial Services, the non-banking financial arm of HDFC Bank, dipped over 1% on Thursday, trading below its July listing price and down more than 12% overall, as investors parsed a quarterly profit decline amid robust revenue growth. The stock touched an intraday low of Rs 733.25 on the BSE, reflecting caution after the company's Q2 FY26 results showed a 1.5% year-on-year drop in net profit to Rs 581 crore, pressured by elevated loan losses and provisions—compared to Rs 591 crore in the prior year. Revenue, however, surged 13% to Rs 4,545 crore from Rs 4,007 crore, signaling sustained business expansion. On a brighter note, HDB Financial declared an interim dividend of Rs 2 per share for FY26, with the record date set for October 24, offering shareholders a modest payout amid the volatility. Despite the near-term headwinds, analysts remain upbeat on the long-term potential. Emkay Global Financial maintained a 'Buy' rating with a target price of Rs 850, citing steady asset under management growth at 13% YoY despite softer asset quality metrics. Jefferies also stuck with its 'Buy' call, projecting Rs 900 per share, underscoring the firm's resilient revenue trajectory even as credit costs ticked up to 2.7%. Other brokerages echoed this sentiment, advising investors to hold or accumulate on dips rather than sell, viewing the profit dip as transitory in a consolidating NBFC sector. With the stock in consolidation mode post-listing, HDB Financial's focus on diversified lending and HDFC Bank's backing could fuel a rebound—making it a compelling buy for patient investors eyeing FY26 growth.