HDBFS
Large CapHDB Financial Services Limited
Financial Services
HDBFS, an RBI-licensed 'Upper Layer' NBFC and HDFC Bank subsidiary, offers enterprise, asset, and consumer finance. It operates 1,730 branches across 1,161 cities, focusing on underbanked customers with a granular, seasoned loan book and strong credit ratings (CARE AAA, CRISIL AAA).
One read, four checks
75+ is strong, 60-74 is usable, 45-59 is mixed, and below 45 needs caution. These are research lenses, not buy/sell instructions.
Weak fundamentals, management trust needs verification, price trend argues for patience, and recent execution is mixed.
Fundamental lens: valuation, quality, growth, balance sheet, and cash flow.
low confidence · 0/0 claims checked
Timing lens: price trend and sector relative strength.
Rolling lens: recent quarterly delivery, not the latest single-result score.
Quarter ended 31 Mar 2026
Good · 65/100Rev +11% YoY · PAT +41% YoY · operating leverage
| Metric | This quarter | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹4,745 Cr | +11.2% | +1.5% |
| EBITDA | NDF | NDF | NDF |
| Operating margin | NDF | NDF | NDF |
| PAT | ₹751 Cr | +41.4% | +16.6% |
| PAT margin | 15.8% | +338 bps | +205 bps |
NDF means not disclosed in the current structured filing feed. It is intentionally not treated as zero.
Where growth can come from, and what can break the case
HDBFS reported strong Q4 FY26 results with PAT up 41.4% YoY to INR 751 Cr, driven by robust NII growth of 21.6% YoY and expanding NIMs. Gross Loan Book grew 10.9% YoY to INR 1,18,493 Cr, while asset quality improved sequentially with GNPA at 2.44%.
The company demonstrated sustained growth in its loan book and profitability, coupled with sequential improvement in asset quality. Expanding NIMs and controlled operating costs indicate operational efficiency. The diversified loan book and strong capital position support continued growth, reinforcing the investment thesis.
Gross Loan Book Mix by Business Vertical (Mar-26)
Latest issuer-disclosed distribution across 3 reported categories.
Customer Franchise Expansion
Customer franchise grew to 22.9 million, an increase of 4.3% QoQ and 19.7% Y-o-Y, primarily catering to underserved and underbanked customers.
Pan-India Distribution Network
Network of 1,730 branches spread across 1,161 cities and towns, with 71% of branches located in Tier 4 & Beyond towns, focusing on expansion in Tier-2+ markets.
Diversified Product Portfolio
Product portfolio serving multiple credit needs across Enterprise Lending, Asset Finance, and Consumer Finance, leading to a granular and well-seasoned loan book.
Digital & AI Capabilities
Leveraging technology stack and AI-powered initiatives like 'HDB OnTheGo' app and AI bots for early bucket collections, improving efficiency and asset quality.
Branch Network Expansion
Branch count stood at 1,730 across 1,161 cities and towns as of March 31, 2026, indicating continued physical presence expansion.
Improved Collection Efficiency via AI
AI-powered bot calling and AI-led quality checks resulted in collection efficiency up by 25bps for early buckets in 4QFY26, supporting portfolio growth.
Credit Risk
Manage risks by defining target markets and underwriting criteria for every product, providing loans only to eligible customers passing minimum credit parameters.
Liquidity Risk
Asset Liability Committee reviews NIMs, maturity profile, and ALM, ensuring compliance with regulatory LCRs and positive cumulative mismatch across all time-buckets.
Interest Rate Risk
Manage risks by performing Gap Analysis to measure interest rate risk exposure to NII, tailoring advances book and funding strategy to offset repricing of borrowings.
Technology & Information Security Risk
Manage risks via Disaster Recovery and Business Continuity Plans, rigorous testing, robust internal policies, and protection against phishing through anti-spam/malware solutions.
What management said, and what results must prove
Issuer guidance and extracted claims are tracked against later reported outcomes. Treat these as management statements, not IndiaPulse forecasts.
Both YoY and QoQ comparisons are crucial for NBFCs. YoY highlights long-term growth trends and seasonal impacts, while QoQ reveals sequential momentum in disbursements, asset quality shifts, and immediate operational efficiency changes.
Gross Loan Book Growth
Gross loan book as on March 31, 2026 stood at ₹1,18,493 crores, growing 3.4% sequentially and 10.9% Y-o-Y.
Disbursements Growth
Disbursements for the quarter ended March 31, 2026 was ₹19,922 crores, up by 11.2% sequentially and by 12.9% YoY.
Net Interest Margin (NIM)
Net Interest Margin for Q4FY26 was at 8.23% vs 8.09% in Q3FY26 & 7.55% in Q4FY25; FY26 NIM was 7.96% vs 7.56% in FY25.
Cost of Borrowings
Cost of Borrowings (quarterly annualized) was 6.9% in Mar-26, down from 7.3% in Dec-25 and 7.5% in Mar-25.
Prudent, Purposeful, Resilient Growth
Management is focused on prudent, purposeful, resilient growth rooted in values, with best-in-class governance practices embedded through pedigreed parentage.
Serving Aspirational India
The company aims to serve 'Aspirational India' by lending to underbanked and underserved customers, leveraging its long operating track record and understanding of customer behavior.
Expansion in Tier-2+ Markets
Pan India presence with focus on expansion in Tier-2+ markets, with over 80% of branches outside 20 largest cities in India.
Numbers and claims to verify in the next filings
| Checkpoint | Current evidence | What to verify next |
|---|---|---|
| Gross Loan Book Growth | 10.9% YoY (Q4FY26) | Sustained double-digit growth, particularly in secured loan segments, indicating healthy demand and effective market penetration. |
| Net Interest Margin (NIM) | 8.23% (Q4FY26) | Maintenance or further expansion of NIMs, reflecting effective asset-liability management and favorable borrowing costs amidst competitive pressures. |
| Gross Non-Performing Assets (GNPA) | 2.44% (Q4FY26) | Continued sequential improvement or stability in asset quality, especially given the focus on underbanked segments and potential macro volatility. |
| Credit Cost to Avg. Gross Loans | 2.3% (Q4FY26) | Stability or reduction in credit costs, indicating effective risk management and portfolio performance, without compromising growth. |
Verification checkpoints are IndiaPulse research interpretation, not investment advice.
Trend score and candlestick chart
42NeutralSMA20 -7.2% / mo
Technical chart
HDBFSdaily · 5Y-14.3%Technical trend read
Bearish setupTrend is weak — long-term trend unclear. RSI 33.
- SMA20 falling (~1.8% over last month) — short-term momentum negative.
- RSI(14) at 33 — falling, no extreme reading.
- MACD below signal, histogram expanding negatively — bearish momentum building.
- 21% off 52W high · 13% above 52W low.
Mechanical read from the price + indicator series above. Not a recommendation — technical setups can reverse without warning, especially around earnings and macro events.
Valuation, score drivers, trust methodology, financials, and peers
Use these sections after reviewing the decision summary, latest result, thesis, management accountability, and technical timing above.
Fundamental score breakdown
OVERVALUEDWhy this score?
Top U-Score contributors and drags from the latest stored fundamentals.
Positive drivers
- Fair-value margin of safety is positive at 37.8%.
- Growth contributes 14/25 to the score.
- Valuation contributes 9/30 to the score.
Main drags
- Altman Z is 0.6, in distress territory.
- Balance sheet is weaker at 0/15; verify the latest quarterly trend.
- Cash flow is weaker at 0/10; verify the latest quarterly trend.
Blended valuation: PE, EV/EBITDA, FCF yield, and balance-sheet checks
For this sector, IndiaPulse uses a blended lens rather than relying on a single valuation ratio.
Stored run vs live recompute
This shows the stored score trend when snapshots exist, and also compares the latest stored nightly score with a live recompute from current fundamentals and price.
Score history
12 stored score snapshots. Latest stored move: +5 points.
Factor attribution
Trust asks: does management behaviour match later outcomes? Higher is better, but confidence and evidence depth matter as much as the number.
Weak Trust: Claim history is still being built. It ranks around the 8th percentile of the scored universe and 16th percentile within Financial Services. Main check: balance sheet trust is weak at 22/100.
Mixed Trust Lite: Promoter holding is 74.1%. Key concern: Operating cash flow is negative at ₹-8606 Cr.
Management or financial behaviour needs caution. Demand stronger valuation compensation.
overall median 67 · Financial Services: 16th pctile, median 62 · Large: 5th pctile, median 74
26 documents indexed, but claim history is not strong enough yet.
0 claims extracted · No contradicted claim yet
How to read this Trust Score
Weak Trust · low confidenceRead Trust alongside U-Score, result consistency, and technical trend. A cheap stock with weak Trust needs a larger margin of safety; a high Trust score does not make an expensive stock attractive by itself.
Forensic breakdown
Read low sub-scores as due-diligence warnings, not automatic sell signals.
Trust positives
- ▸Promoter holding is 74.1%.
- ▸Promoter pledge is zero.
- ▸4/4 latest quarters had positive YoY revenue growth.
Trust risks
- ▸Operating cash flow is negative at ₹-8606 Cr.
- ▸Debt/equity is 4.80.
- ▸Altman Z is 0.59.
- ▸Only 0 years of positive FCF.
Trust Lite uses financial behaviour only. Prefer claim-tested Trust when enough concall claims have later outcomes.
Intrinsic value
Fundamentals
Valuation
- P/E
- 20.50
- P/B
- 2.52
- EV/EBITDA
- 723.97
- Market Cap
- 52079.00Cr
Profitability
- ROE
- 13.90%
- ROCE
- 9.09%
- ROA
- 2.06%
- Dividend Y
- 0.64%
Growth (CAGR)
- Revenue 5Y
- 11.00%
- EPS 5Y
- 45.00%
- Revenue 3Y
- 14.00%
- EPS 3Y
- 9.00%
Balance Sheet
- Debt/Equity
- 4.80
- Interest Coverage
- —
- Altman Z
- 0.59
- Book Value
- 249.00
Cash Flow
- FCF Yield
- —
- FCF Positive Y
- 0/5
- OCF
- -8606.00 Cr
- EPS TTM
- 30.64
Shareholding
- Promoter Hold
- 74.12%
- Promoter Pledge
- 0.00%
- Momentum 52W
- 21%
Financial History
Updated 9/6/2026
Revenue
₹ CrNet Profit
₹ CrReturn on Equity
%Peers
Business-comparable peers in Financial Services — ranked by industry, sub-sector, theme-tag overlap, market cap, and U-Score similarity. Green cells mark the best available peer metric in this table.