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Buy HDFC Bank; target of Rs 1385: Prabhudas Lilladher

Prabhudas Lilladher is bullish on HDFC Bank has recommended buy rating on the stock with a target price of Rs 1385 in its research report dated October 18, 2020.

October 20, 2020 / 02:08 PM IST
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Prabhudas Lilladher's research report on HDFC Bank

HDFCB’s earnings were marginally lower than expected at Rs75.1bn (PLe: Rs75.9 bn). Miss was from NII, which grew by 17% YoY (PLe: 18% YoY) on slightly sharper NIM decline of 20bps QoQ and slightly higher provisions for strengthening b/s. More or less the commentary has been on positive side with (i) collections at 95% for Sept’20 & 97% for Oct’20, (ii) month on month improving disbursement trends in retail with 2x from Jun’20 and (iii) pick-up in utilization of credit in corporate is suggesting activity coming back to near or above pre-covid levels. Bank is placed in a strong position with prudent provisioning buffers at 0.7% of loans and high PCR of 85% (pro-forma 75%), while should have much lower restructuring & asset quality outcome than industry.


We retain BUY with revised TP of Rs1,385 (from Rs1,265) based on 3.1x multiple as we roll over our valuations to Sep-22 ABV.

For all recommendations report, click here

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on are their own, and not that of the website or its management. advises users to check with certified experts before taking any investment decisions.

Broker Research
first published: Oct 20, 2020 02:08 pm

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