RBI's Green Light for HDFC Group's 9.5% stake in IndusInd Bank; understanding the investment strategy

New Delhi: HDFC Bank, which is the largest private bank in the country, is again in the limelight. The Reserve Bank of India has approved HDFC Bank and its group entities to hold up to 9.5 percent stake in IndusInd Bank. This approval is considered an important sign in terms of investment. RBI has given this permission to the bank through a letter dated December 15, 2025. This sanction will be valid for one year and will come into force by 14 December 2026. The central bank has clarified that at any point of time IndusInd Bank's total stake in paid-up share capital or voting rights should not exceed 9.5 percent.

This permission will be applicable to the joint i.e. aggregate holding of HDFC Bank and its group entities. This includes HDFC Mutual Fund, HDFC Life Insurance, HDFC ERGO General Insurance, HDFC Pension Fund Management and HDFC Securities. HDFC Bank plays the role of promoter or sponsor in all these institutions.

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According to the RBI's Commercial Banks Acquisition and Holding of Shares or Voting Rights Directions 2025, aggregate holding includes the bank's own stake as well as entities and mutual funds under its control or management.

HDFC Bank has clarified that it has no direct investment plan in its own IndusInd Bank. However, the investment of group entities was likely to go above the earlier 5 percent limit. For this reason, the bank had sought permission from the RBI to increase the investment limit on 24 October 2025. The bank says that the investment made by group companies is part of their normal business activities.

On Monday, HDFC Bank's share was trading at Rs 995.70 apiece at the time of writing this article on December 16 morning. The banking stock has risen by 3 percent on a quarterly basis and it has increased by 6.43 percent on an annual basis. As of 15th December 2025, HDFC Bank's market cap was around Rs 1532251.88 crore.