
The dividend yield is computed based on the closing price of 30th June 2025. We have considered companies that have consistently paid dividend in the last 3 years – i.e FY24/CY23, FY23/CY22 and FY22/CY21.
HDB Financial Services Ltd (HDBFS) is categorized as an upper-layer NBFC by the Reserve Bank of India. It is the 4th largest diversified retail-focused NBFC (by Gross Loan Book size) as of Mar’25. It is a subsidiary of HDFC Bank, which is the largest private sector bank in India in terms of total assets as of Mar’25
We believe the valuation still looks attractive for long-term investors on back of (a) Expected expansion in EBITDA/t, post stabilization of Hydraulic tubes and CDW pipes capacity, (b) Commencement of commercial production at the new Defence & Aerospace facility by 2HFY26, (c) Healthy business relations with marquee clients across the public and private domain and (d) Positive demand outlook for solar torque tubes in the long run. At the CMP of Rs 900, the stock is trading at a P/E of 14.8x/11.3x of its FY26E/FY27E EPS of Rs 60.9/Rs 79.9 respectively. We assign the stock a P/E multiple of 15x on FY27E period EPS of Rs 79.9 to arrive at our TP of Rs 1,199, thus providing an upside potential of 33.2%
Healthy order book; The IPP revenue to pick up going ahead: The current book of the company as of Mar’25 stood at 2,958 MW comprising of 1,202 MW IPP and 1,756 MW CPP orders. The CPP orders are to be executed over the next 12-15 months while new IPP orders to be full executed by FY27. The company is targeting to execute 1.5 GW of IPP project by 1QFY27
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