LKP Research's research report on HDFC Bank
HDFC Bank reported a decent quarterly performance with a modest growth in its loan book and strong growth in deposits, driven by continued focus on improving its credit-deposit (C/D) ratio. As a result, the bank reported a lower NIM on YoY basis and is expected to remain range bound in the medium term. Moreover, despite the deterioration in the bank’s asset quality, it is expected to remain resilient in a challenging macro environment with prudent provisioning policies and tightening underwriting. Furthermore, with a better asset mix, adequate capital, innovative digital solutions and a broad branch network the bank is well-positioned to capture long-term growth opportunities.
Outlook
Hence, with an optimistic outlook, we assign a BUY rating on the stock, based on 2.2x FY27E BVPS with a target price of ₹1,895.
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