Angel Broking neutral on HDFC Bank

Trade

• Watchlist
• Portfolio
• Message
• Set Alert

 

 

Choose Stock Exchange: BSE LIVE NSE LIVE

26 Aug, 2025 12:21

Volume

Todays L/H

More

×

Angel Broking has maintained neutral rating on HDFC Bank, in its January 18, 2013 research report.
 
“HDFC Bank delivered another quarter of consistent performance on the bottom-line front, with a growth of 30% yoy, in-line with our as well as the street’s estimates. In spite of an operating income growth of 23% yoy, the bank’s other income growth, boosted by treasury gains and overall steady provisioning, aided it to clock 30% yoy growth at the bottom-line level.”
 
“The bank registered a robust growth in its balance sheet, with net advances and deposits growing at 24.3% and 22.2% yoy, outpacing industry average growth. On the CASA front, the current account (adjusted for one-offs) and saving account accretion was healthy, growing at 15.9% and 16.5% yoy, respectively. CASA ratio dipped by 50bp qoq to 45.4%. The share of retail advances to overall loan book, increased from 53.2% in 2QFY2013 to 53.8%, on back of lower wholesale lending (2.8% qoq compared to 5.5% qoq in retail loans). In spite of higher retail lending, the bank’s margins declined by10bp qoq to 4.1%, primarily due to absence of dividend income during the quarter, which had aided the margins in 2QFY2013 and also due to 50bp sequential fall in CASA ratio. Overall, the non-interest income grew by 26.7% yoy, aided by treasury gains and robust growth on the fee income front. Excluding treasury gains, the non-interest income grew at a moderate pace of 10.7% yoy. The bank faced modest pressures on the asset quality front this time around, as its Gross and Net NPA levels increased sequentially by 14.0% and 28.2%, on an absolute basis. The management explained that around 40% of the total increase in Gross NPA levels during the quarter came in from CVCE loan book, within the retail portfolio. Overall, Gross and net NPA ratios for the bank remain amongst the best in the industry at 1.0% and 0.2%, respectively. The bank made floating provision of `30cr during the quarter, which took its outstanding floating provisions to around `1,700cr. NPA provision coverage ratio (without considering the floating provisions) came off sequentially by 225bp to 79.6%.”
 
“HDFC Bank is currently trading at one-year forward 3.9x P/ABV (3.7x FY2014 ABV), higher than its median of 3.5x (over FY2005-12). We believe the current valuations largely factor in the positives, leaving limited upside in the stock. Hence we recommend a Neutral rating on the stock,” says Angel Broking research report.

Read More