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Buy HDFC Bank: target of Rs 1810: Sharekhan

Sharekhan is bullish on HDFC Bank has recommended buy rating on the stock with a target price of Rs 1810 in its research report dated July 16, 2021.

July 19, 2021 / 05:16 PM IST
An Edelweiss research report for Q4FY21 says road tonnage continued to improve, evident in e-way bill generation (up 6% QoQ) and improved core trucking rentals. “We estimate tonnage would increase by three–five percent for truckers. Asset-light plays Mahindra Logistics and TCI Express remain our preferred picks due to their ability to scale up/down as the environment demands,” the report said. Edelweiss is bullish on Blue Dart Express due to the pandemic-induced boom in e-commerce and its leaner cost structure. It has retained a ‘buy’ call on Mahindra Logistics, TCI Express and Blue Dart Express.

An Edelweiss research report for Q4FY21 says road tonnage continued to improve, evident in e-way bill generation (up 6% QoQ) and improved core trucking rentals. “We estimate tonnage would increase by three–five percent for truckers. Asset-light plays Mahindra Logistics and TCI Express remain our preferred picks due to their ability to scale up/down as the environment demands,” the report said. Edelweiss is bullish on Blue Dart Express due to the pandemic-induced boom in e-commerce and its leaner cost structure. It has retained a ‘buy’ call on Mahindra Logistics, TCI Express and Blue Dart Express.

 
 
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Sharekhan's research report on HDFC Bank


Operational performance was mixed in Q1FY2022.NII growth at 8.6% y-o-y in Q1QFY22 was lowest since Q1FY16 due to slower retail loan growth. NIM slid 10 bps lower q-o-q to 4.1%. PAT met expectations despite higher provisions, but this provides bank adequate cushions going ahead. Asset quality deteriorated q-o-q primarily due to subdued collections given the lockdowns in April-May amid the second wave of COVID-19. Advances rose decently and an improved CASA ratio helped sustain NIM q-o-q. HDB financials earnings contracted 44% y-o-y in 1Q due to the end wave of pandemic. GNPL to 7.75% in 1Q from 3.9% in 4QFY21. Stock currently trades at 3.9x/3.4x its FY2022E/FY2023E ABVPS, it has underperformed the broad BSE Sensex by 5% in the past 12 months, indicating a favourable risk-reward.



Outlook


We retain a Buy with an unchanged price target (PT) of Rs. 1,810.


For all recommendations report, click here


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first published: Jul 19, 2021 05:16 pm

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