HDB Financial Services , a prominent player in the financial services sector, has announced its second-quarter results, revealing a mixed performance. The company has also declared an interim dividend, signaling confidence in its financial position despite some challenges.

Financial Performance

HDB Financial Services reported a quarterly revenue of ₹45.45 billion, marking a significant increase from ₹40.00 billion in the same period last year. This 13.63% year-over-year growth demonstrates the company's ability to expand its business operations and capture market opportunities.

However, the company's bottom line showed a slight decline. Net profit for the quarter stood at ₹5.81 billion, down from ₹5.91 billion in the corresponding period of the previous year, representing a marginal decrease of 1.69%.

Key Financial Metrics

Asset Quality

The gross stage 3 ratio, an indicator of non-performing assets, increased to 2.81% from 2.56% quarter-over-quarter. This rise suggests a slight deterioration in asset quality, which could be a point of concern for investors and analysts.

Interim Dividend

HDB Financial Services has declared an interim dividend of ₹2.00 per share. This decision to distribute profits, despite the marginal decline in net profit, could be seen as a sign of the management's confidence in the company's financial stability and future prospects.

Employee Stock Options

The company has also announced significant employee stock option grants:

• 15,10,520 options under ESOP Plan 18A
• 9,71,980 options under ESOP Plan 18B
• 9,63,670 options under ESOP Plan 18C

All options were granted at a price of ₹739.85 per share, based on the closing price on October 13, 2025.

Outlook

While HDB Financial Services has shown strong revenue growth, the slight dip in profitability and increase in the gross stage 3 ratio may warrant careful monitoring. The company's decision to grant ESOPs and declare an interim dividend suggests confidence in its long-term prospects, but investors may want to keep an eye on asset quality trends and profitability metrics in future reports.

As the financial services sector continues to evolve, HDB Financial Services' ability to maintain its growth trajectory while managing asset quality will be crucial for its future performance.

HDB Financial Services , a non-bank subsidiary of HDFC Bank, has announced the grant of Employee Stock Options (ESOPs) ahead of its September-quarter results, as the company's stock continues to trade below its initial public offering (IPO) price.

ESOP Grant Details

The company's Nomination & Remuneration Committee (NRC) has approved the grant of ESOPs under three different plans:

Each option, upon exercise, will be convertible into one equity share of the company. The grant price of ₹739.85 per option is based on the closing price of HDB Financial Services' shares on the National Stock Exchange of India on October 13.

Vesting Schedule

For all three ESOP plans, the vesting of options will commence after one year from the grant date and will occur over a three-year period as follows:

Stock Performance and Q2 Expectations

HDB Financial Services' stock has declined 16% from its listing price since its debut two months ago following a ₹10,000 crore IPO. As the company prepares to announce its September-quarter results, analysts are projecting:

• Loan growth of 13% year-on-year and 2% sequentially
• Margin expansion of 5 basis points
• An increase in credit costs by 10 basis points to 2.6%

The company continues to expand its branch network and digital channels in Tier 2 and 3 cities, indicating a focus on growth in these markets.

Technical Analysis

Technical analysts note that the stock is currently consolidating above the ₹700-740 support zone. There is potential for upside movement to the ₹800-850 range if the stock can sustain above the ₹740 level.

As HDB Financial Services prepares to release its Q2 results, investors will be closely watching for signs of improvement in the company's financial performance and any potential impact on its stock price.