HDFC Bank fall short-term; buy at Rs 875-880 level: Experts

HDFC Bank shares plunged sharply on Friday following a sell off by foreign funds after it was deleted from the MSCI India index. The street was half expecting the action as MSCI, in its earlier review, had indicated that the bank’s failure to raise FII limit may result in MSCI India index exclusion. The private sector lender had been knocking at Foreign Investment Promotion Board's (FIPB) door for an approval on FII limit.

Speaking about event, Mehraboon Irani told CNBC-TV18 that all stocks get a jolt when dropped from MSCI Index. In fact, the 2 percent cut on the price of HDFC Bank was not as sharp as expected. “Possibly many people were expecting it (the exclusion) and have lightened their portfolio ahead of the event.”

Neeraj Deewan of Quantum Securities feels the price decline will end in two-three days. He pointed out that HDFC Bank has underperformed its peers YTD and because of its fundamentals remains on his buy list. Calling its a short-term shedding, Deewan said he will not advise selling the stock.

Irani too agrees that the stock is attractive at the current level. “But I am not in a hurry. I will enter when the stock touches Rs 875-880 levels."