Prabhudas Lilladher's research report on HDFC
HDFC’s earnings missed estimates led by sequentially lower core metrics. AuM growth was largely in-line at 17% YoY mainly driven by individual loans while NII and margins were lower. Core PPoP was lower by 8%, while higher provisions led to PAT miss by 11.5%. As per management, ROE expansion would be driven by NII growth, controlled opex and decline in credit costs. Management indicated that home loan demand remains strong while construction finance & LRD could see an uptick. With respect to merger, few approvals have been received, while dispensation on stake in subsidiaries is yet to be clarified.
We retain our multiple at 2.3x based on FY24 P/ABV and TP of Rs2,900 with BUY rating.
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