Buy HDFC Bank; target of Rs 1246:Khambatta securities

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26 Aug, 2025 12:21

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Khambatta securities's research report on HDFC BankHDFC bank reported strong sets of number in its 3Q FY16 financial results which were in-line with our expectation. During the quarter, net interest income (NII), operating income, operating profit and net profit remained exaclty in-line with our estimates. NII grew by 24% to Rs 70.68 bn against our estimate of Rs 70.35 bn, driven by robust growth in advances and sequential healthy net interest margin (NIM). During the quarter, advances grew by 25.7% y-o-y to Rs 4,364 bn. Bank reported a very healthy growth in operating income to Rs 99.41 bn against our expectation of Rs 99.70 bn, registered 20.7% y-o-y growth, aided by moderate growth non-interest income. Sequentially, non-interest income grew by 12.6% and annually it grew by 13.3% to Rs 28.72 bn, marginally below from our estimate.At CMP of Rs 1,036, we continue with “Strong Buy” aided by healthy mix of retail & wholesale loan book, robust asset quality and healthy growth in overall business. At CMP of Rs 1,036/share, stock is available at 3.68x FY16E adjusted book value (ABV) of Rs 281.5 and 3.16x FY17E ABV of Rs 327.8. Based on 3.8x FY17E ABV of Rs 328/share, we arrive at a target price of Rs 1,246/share ~ implying 20% upside.For all recommendations, click here 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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