Moneycontrol Bureau
Leading brokerages are mixed in their views on HDFC Bank after the third quarter earnings reported Friday.
Quarterly net profit grew 25 percent year-on-year to Rs 2,326 crore from Rs 1,859 crore. The bank's net interest income (difference between interest earned and interest paid out) for the quarter rose 22 percent to Rs 4,635 crore from Rs 3,799 crore during the same period.
The bottomline met analysts expectations, supported by other income, which climbed 11.4 percent year-on-year to Rs 2,148.3 crore.
Religare has kept HDFC bank as its preferred pick among private banks. The broking house has rated it a 'buy' with a target price of Rs 760 as the quarterly numbers were in line (both NII and PAT). The bank's advances were up 22.9 percent to Rs 2,96,742 crore (Y-o-Y). Religare is bullish on HDFC Bank's asset quality, claiming it to be best in class.
JP Morgan has rated HDFC Bank 'overweight' with a target price of Rs 750 while keeping it as 'top defensive pick'. It feels the bank's asset quality is resilient and credit costs are controlled. However, it feels the fees and margin were weak.
Citi has kept a 'neutral' outlook on HDFC Bank with a target price of Rs 750. According to Citi, though the bank's third-quarter numbers are not perfect, but they are solid and well rounded. It feels HDFC Bank has underlying earnings momentum with its FCNR gains ahead of peers and a stable asset quality.
HDFC Bank's total deposits grew 22.9 percent year-on-year to Rs 3,49,215 crore, which included USD 3.4 billion being deposits raised under the RBI window for attracting Foreign Currency Non-Resident (FCNR) deposits.
HDFC Bank management has said that they are going slow on lending in the commercial vehicle and construction equipment segment, the Citi note said
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