Buy HDFC Bank; target Rs 762: Firstcall Research
Brokerage house Firstcall Research is bullish on HDFC Bank and has recommended buy rating on the stock with a target price of Rs 762 in its July 20, 2013 research report.
July 29, 2013 / 13:07 IST
Firstcall's research report on HDFC Bank
The net income of the bank has increased from Rs. 80074.20 mn to Rs. 96629.60 mn in June quarter 2013 over the previous year. Profit after Tax increased by 30.09 percent in June 2013 over the corresponding quarter in the previous year. Earning per share of the company increased by 28.30 percent in June 2013 from Rs. 6.02 to Rs. 7.72.The total income of the bank comprises of mainly interest earned, income on investments, interest on balances with RBI and other income. Interest earned by HDFC bank is the major component of total income of Rs. 73247.40 mn in 30 June 2013. The other major components of total income earned by the bank are income on investments and other income which are 22178.2 mn & 19256 mn respectively. Interest earned has increased by Rs. 2382.10 mn over the previous quarter and income on investments and other income have contributed equally by Rs. 1219.70 mn. In this difficult banking scenario, HDFC Bank has increased its revenues by focusing equally on income on investments and other income which comprises of fees &commission, foreign exchange revenue, revaluation of assets and misc income.Outlook and Conclusion: "At the current market price of Rs.680.80, the stock P/E ratio is at 19.73 x FY14E and 16.39 x FY15E respectively. Earnings per share (EPS) of the company for FY14E and FY15E are seen at Rs.34.51 and Rs.41.53 respectively. Net Income and PAT of the company are expected to grow at a CAGR of 27 percent and 24 percent over 2012 to 2015E respectively. Price to Book Value of the stock is expected to be at 3.66 x and 2.99 x respectively for FY14E and FY15E. We expect that HDFC Bank to strengthen its position in the banking sector and continue its growth story in the coming quarters also. We recommend 'BUY' in this particular scrip with a target price of Rs762.00 for Medium to Long term investment," says Firstcall Research report.Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions. 
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