The star shuttler was received at Rajiv Gandhi International Airport by her parents, relatives, ministers and officials from both Telangana and Andhra Pradesh.
Sindhu and her coach Pullela Gopichand were accorded a grand welcome as they came out of the airport.
Telangana Deputy Chief Minister Mohammed Mehmood Ali and his Andhra Pradesh counterpart N. Chinnarajappa and ministers from the two states presented bouquets.
Sporting an infectious smile and proudly displaying her medal, Sindhu came out to loud cheers by a large number of badminton players, her friends and school students.
Sindhu and Gopichand then boarded an open top bus for the ride to the Gachibowli Stadium.
Fans lined the 20 km route from the airport to the stadium to catch a glimpse of the star, who made history by becoming the first Indian woman to win a silver medal at the Olympics.
Politicians and officials welcomed Sindhu at special tents put up along the route. The tents were decked up with huge pictures of the star shuttler.
The Greater Hyderabad Municipal Corporation (GHMC) had erected welcome arches and installed hoardings to welcome Sindhu and Gopi.
Acharya Jai Shankar University of Agricultural Sciences at Aramgarh had installed a huge hoarding of Sindhu at its main gate.
At Gachibowli Stadium, Sindhu will take a victory lap amid the rendering of patriotic songs by a police band.
The atmosphere at the stadium was electrifying with thousands of students from various schools gathering here to welcome “silvern” Sindhu.
Carrying the national flag, students filled the stadium and kept cheering at regular intervals.
Artists were presenting cultural show on a special dais.
The GHMC, Sports Authority of Telangana, and Telangana State Olympic Association has made elaborate arrangements for a grand state reception and felicitation for Sindhu.
Huge screens were installed in the stadium to enable people to closely watch the proceedings.
After the felicitation, Sindhu will meet, at his camp office, Telangana Chief Minister K. Chandrasekhar Rao, who has announced a reward of Rs 5 crore, a 1,000-yard plot, and a government job for her.
Andhra Pradesh has also announced Rs 3 crore cash, land and a job for Sindhu. The state government also decided to separately felicitate her.