Buy HDFC Bank; target of Rs 1900: Sharekhan

Sharekhan's research report on HDFC Bank

HDFC Bank`s business update for Q4FY24 indicated that deposit mobilisation (up 7.5% q-o-q) has been very strong amid a tight liquidity environment, which is a key positive. CASA growth (up 8.4% q-o-q) has also picked up strongly. CASA ratio at 38.2% versus 37.7% q-o-q. Deposit growth has smartly outpaced the rise in gross advances (up 1.6% q-o-q) resulting in faster normalisation of the credit-deposit ratio.

Outlook

At CMP, the stock trades at 2.1x and 1.8x its FY2025E and FY2026E core BV estimates, respectively. We maintain our Buy rating with an unchanged PT of Rs. 1,900.

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